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Cumulative vs. Week 1 Re: reduced tax credits

  • 15-11-2020 12:15pm
    #1
    ChromeDreams
    Registered Users, Registered Users 2 Posts: 34 ✭


    Hi all,

    I left my job in February of this year hoping to spend a month out of the job, but then Covid threw that on its head! So I ended up claiming Jobseekers Benefit from February - October. This has left me with net tax credits of 671.30.

    Right now I am being savaged by PAYE deductions each week. I am currently on a Week 1 basis of tax. My question is, given my circumstances would a Cumulative basis be more beneficial for the remainder of 2020?


Comments

  • #2
    ChromeDreams
    Registered Users, Registered Users 2 Posts: 34 ✭ChromeDreams


    A quick addition to this is that I have received five weeks of pay in my new job. The first three weeks I got hammered with PAYE on Week 1 basis, but for the fourth week I changed it to cumulative via MyEnquiries. In the fourth week I received big refunds in PAYE and USC so assumed everything was sorted.

    However, in the meantime I had spoken to a bookkeeper I know who advised me to change to Week 1 as I have a liability (€250) to Revenue and my tax would be better off on Week 1. I did this, and in the fifth week I went back to being taxed heavily.

    I assume this confirms that cumulative would be the better option for the rest of the year but thought it smart to run by people in the know.


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