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Help dividing tax credits

  • 23-06-2021 12:47pm
    #1
    fiestaman
    Registered Users, Registered Users 2 Posts: 1,174 ✭✭✭


    Hi, I'm in the process of changing myself and my wife's taxation to joint assessment as we are now married.
    On revenue online it gives different options for dividing the tax credits. How an I choose which suits best. My income is around €42k based on commision and she earns €18k. Can anybody advise??


Comments

  • #2
    jimmycrackcorm
    Registered Users, Registered Users 2 Posts: 14,378 ✭✭✭✭jimmycrackcorm


    fiestaman wrote: »
    Hi, I'm in the process of changing myself and my wife's taxation to joint assessment as we are now married.
    On revenue online it gives different options for dividing the tax credits. How an I choose which suits best. My income is around €42k based on commision and she earns €18k. Can anybody advise??

    Joint assessment and transfer her unused credits to you. Basically what will change is that all your tax will be at 20% instead of income > 34k being taxed at the marginal rate.

    All you need to know

    What kind of savings can be made?
    The primary benefit of joint assessment is the ability to transfer tax bands and credits between partners. This means you can reduce the amount of tax you have to pay at the higher rate, which could be a significant saving. The standard rate cut-off point for married couples is €42,800.

    This amount is taxed at 20%, the balance being taxed at 40%. If both partners have income, which is increasingly the case, this standard rate cut-off point can be increased by up to €24,800. Aside from the tax rate cut-off point, the other benefits you can receive from tax credits span several areas of married life.


  • #3
    fiestaman
    Registered Users, Registered Users 2 Posts: 1,174 ✭✭✭fiestaman


    jimmycrackcorm wrote: »
    Joint assessment and transfer her unused credits to you. Basically what will change is that all your tax will be at 20% instead of income > 34k being taxed at the marginal rate.

    All you need to know

    What kind of savings can be made?
    The primary benefit of joint assessment is the ability to transfer tax bands and credits between partners. This means you can reduce the amount of tax you have to pay at the higher rate, which could be a significant saving. The standard rate cut-off point for married couples is €42,800.

    This amount is taxed at 20%, the balance being taxed at 40%. If both partners have income, which is increasingly the case, this standard rate cut-off point can be increased by up to €24,800. Aside from the tax rate cut-off point, the other benefits you can receive from tax credits span several areas of married life.

    Thank you, so should I choose option 2 in the attachment below? Will my wife's wages stay the same and can it hinder in anyway down the line? Sorry I'm not up to speed on this at all.


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