Tax Calculation Thread

y0ssar1an22 · 19-06-2020 4:50pm

those tax credits are none refundable, so they cannot generate a refund.

its seems like you have 2 x personal tax credits + 1 paye tax credit. does your spouse/CP have income you could assign the €950 against?

if the additional €1650 is not a personal tax credit belonging to a spouse/CP please ignore the above.

Sheep Shagger · 21-06-2020 2:40pm

Quick question and I hope this is the right thread.

When calculating rental income expenses, I know buying a couch or fridge has to be written off at 12.5% per year.

Does anyone know of this same rule applies to smaller items such as an outside camera if I was to get one installed for a tenant. The Revenue website is not too prescriptive.

I know capital expenses/improvements are not allowed but we are talking a couple of hundred euros so hardly a big expense.

https://www.revenue.ie/en/property/rental-income/irish-rental-income/what-expenses-are-allowed.aspx

y0ssar1an22 · 21-06-2020 4:07pm

Sheep Shagger wrote: »

Quick question and I hope this is the right thread.

When calculating rental income expenses, I know buying a couch or fridge has to be written off at 12.5% per year.

Does anyone know of this same rule applies to smaller items such as an outside camera if I was to get one installed for a tenant. The Revenue website is not too prescriptive.

I know capital expenses/improvements are not allowed but we are talking a couple of hundred euros so hardly a big expense.

https://www.revenue.ie/en/property/rental-income/irish-rental-income/what-expenses-are-allowed.aspx

its a judgment call. I usually say anything less than €1,000 to write off entirely in the year of purchase.

Sheep Shagger · 21-06-2020 4:49pm

y0ssar1an22 wrote: »

its a judgment call. I usually say anything less than €1,000 to write off entirely in the year of purchase.

Thanks, that would kind of be my way of thinking although in the past nothing has been more than a few hundred quid (like a new microwave or a toaster/kettle set) and not loads of individual items so as not be seen to be taking the piss).

TheBlock · 23-06-2020 6:40pm

Looking for a little advice or a rough estimate on Tax amount on a possible redundancy payment.

Lumpsum due 160.000 inclusive of statutory.

17 full years serviced

Average annual salary for last 36 months 85000

Possible lumpsum due from Pension ( in two years as only 48) 125000 ( have 500,000 in pot)

Can anyone provide Rough gide on net lumpsum?

Thanks in advance

y0ssar1an22 · 23-06-2020 7:49pm

TheBlock wrote: »

Looking for a little advice or a rough estimate on Tax amount on a possible redundancy payment.

Lumpsum due 160.000 inclusive of statutory.

17 full years serviced

Average annual salary for last 36 months 85000

Possible lumpsum due from Pension ( in two years as only 48) 125000 ( have 500,000 in pot)

Can anyone provide Rough gide on net lumpsum?

Thanks in advance

if im reading correctly:

~57k (lets say 60k) of the 160k is statutory, therefore tax free: (85000/52 * 2 * 17 + 1 extra week).

The reminder: 100k.

basic exemption: 10160 + (17)(765) = 23165 tax free
increased: 23165 + 10000 - 125000 = 0 tax free
SCSB: (85000/15)*17 - 125000 = 0 tax free

tax on 100 - 23 = 77k. 77 @ 52% = 40k.

Total net:

statutory 60k
basic exemption: 23k
net of reminder: 37k

120k

tax: 40k

total: 160k

MuddyDog · 21-09-2020 4:55pm

When I joined my current company I was given shares for free each year I stayed with them. It's been 5 years now and apparently I have to exercise them before the end of 6 years. I'm thinking of doing it soon but wondering about the tax on them.

I have 337 shares to exercise. Sale price is about 119 quid meaning gross proceeds after brokerage fees and the likes would be about 40k let's say. Cost of the options is 27.5k meaning I'm left with net proceeds of 12.5k. What is the tax breakdown of this? I'm finding conflicting reports online about Income Tax, CGT etc etc.

mp3ireland2 · 12-11-2020 11:38am

I don't understand how marriage taxation works, I wanted to check what the tax free allowance is got myself and my wife. I'm down as the assessable spouse, and think my tax free earnings will be about 24k. Does that mean my wife gets no tax free allowance?

Ah I just understand now, she'll have a tax free earnings of about 8,250

relax carry on · 12-11-2020 12:10pm

mp3ireland2 wrote: »

I don't understand how marriage taxation works, I wanted to check what the tax free allowance is got myself and my wife. I'm down as the assessable spouse, and think my tax free earnings will be about 24k. Does that mean my wife gets no tax free allowance?

Ah I just understand now, she'll have a tax free earnings of about 8,250

There is no such thing as tax free allowance. There are rate bands and credits which make up the two elements of the paye system. Essentially under joint assessment you can leave everything exactly as it was before marriage. So that's both spouses keep there own stand rate bands and credits. Depending on the spouses earnings it may be beneficial to transfer a portion of unused crrdits and/or rate band to the other spouse. In a joint assessment case, up to 1650 euro of one spouses Personal credit can be transferred over to the other and up to 9000 of their rate band. Its only beneficial to do this if the other spouse isn't actually utilising them.

mp3ireland2 · 12-11-2020 2:30pm

relax carry on wrote: »

There is no such thing as tax free allowance. There are rate bands and credits which make up the two elements of the paye system. Essentially under joint assessment you can leave everything exactly as it was before marriage. So that's both spouses keep there own stand rate bands and credits. Depending on the spouses earnings it may be beneficial to transfer a portion of unused crrdits and/or rate band to the other spouse. In a joint assessment case, up to 1650 euro of one spouses Personal credit can be transferred over to the other and up to 9000 of their rate band. Its only beneficial to do this if the other spouse isn't actually utilising them.

Ah ok yeah we did it up to the max so essentially I can earn 24,750 (4,950÷0.2) before I've to pay tax and she can earn 8,250 (1,650÷.2) before she has to pay tax .
Didn't realise you could specify how much you transfer, thought it was just 1650 or nothing so something we can consider for next year,. I only started working in Ireland in October this year and her in November so neither of us will need to pay income tax.

irish_goat · 29-03-2021 1:29pm

Just received my first pay slip and I've been charged USC and PRSI but no PAYE. I've signed up correctly on MyAccount, as far a I can see. There's 2 tax credit amounts listed so I'm guessing they are what is causing me not to pay tax this month?

ari101 · 29-03-2021 2:02pm

irish_goat wrote: »

Just received my first pay slip and I've been charged USC and PRSI but no PAYE. I've signed up correctly on MyAccount, as far a I can see. There's 2 tax credit amounts listed so I'm guessing they are what is causing me not to pay tax this month?

Given you are paying PRSI and mention having 2 credits, I'm assuming you are on standard credits (1650*2) and have an annual gross salary which is high enough that some tax would payable in a full working year.

So it could be due to cumulative basis.

If you had no income or low social welfare Jan-Mar prior to this, there would be unused tax credits for that period which add up until you start earning. Now that you are earning those tax credits begin to be used. If this is the case, at some point you might catch up with the excess credits from earlier and therefore end up paying some tax later in the year.

irish_goat · 29-03-2021 2:29pm

Yeah, I was working in the North for January and February so guessing tax will kick in soon then. Cheers.

paulgalway · 31-03-2021 12:54am

I am a sole trader and PAYE.

What is the best method for recording mileage.

I use my own car to travel from home to place of business and then from there to my PAYE job.

Is there an App or does anyone have examples of a spreadsheet to use.

TIA.

davindub · 31-03-2021 9:29am

paulgalway wrote: »

I am a sole trader and PAYE.

What is the best method for recording mileage.

I use my own car to travel from home to place of business and then from there to my PAYE job.

Is there an App or does anyone have examples of a spreadsheet to use.

TIA.

Neither are allowable.

Seve OB · 31-03-2021 1:51pm

davindub wrote: »

Neither are allowable.

What he said

greengirl1968 · 28-04-2021 8:45pm

Hi, I wonder if anyone can help - my tax credits are divided between myself and my husband - he takes the majority of them, i recently took a part-time job and am being taxed 50% which is a huge amount of tax - is there any way to claim back that tax - if I were to invest in a pension would I be able to offset this tax. I would appreciate any advice, thanks

relax carry on · 28-04-2021 9:08pm

greengirl1968 wrote: »

Hi, I wonder if anyone can help - my tax credits are divided between myself and my husband - he takes the majority of them, i recently took a part-time job and am being taxed 50% which is a huge amount of tax - is there any way to claim back that tax - if I were to invest in a pension would I be able to offset this tax. I would appreciate any advice, thanks

If you are being taxed at 50% then that sounds like emergency tax. Have you checked your Revenue my account to see that your job is registered and that your tax credits /rate band are allocated correctly?

lintdrummer · 30-04-2021 12:00am

Hi all, looking for a bit of advice on taxation. I will be seeking professional advice but hoping someone here can give me a general outline.

I am currently employed by an Irish company. I am taking a secondment position in the UK with a UK company. I will be payed by the UK company for the duration of my secondment.

Due to the nature of my job (pilot) I can commute to the UK for work. This is my favoured option as I own a house in Ireland.

Also due to the nature of my work, I believe if I was non resident in the UK I would pay little tax there because I am only in the country for a brief time before and after a flight. If I was technically non resident in Ireland by virtue of spending so much time away, how would my tax be calculated?

Of course the other option is to become a UK resident for the duration of the secondment. This isn't off the table altogether but as I said I would rather commute.

So can anyone offer any input into how this would work from a tax perspective and would I be better off being a UK resident? I'm trying to make the best decision here because my income has been hit hard during the pandemic.

Thanks in advance.

DmanDmythDledge · 30-04-2021 12:21am

If you are non-UK resident and Irish tax resident ultimately you would pay Irish tax and receive a credit for UK payroll taxes played. The Irish tax rate is higher so basically you'd be paying Irish taxes. UK day count for residency is different to Ireland - I think it only counts as a day spent if they at midnight (Ireland is any part of the day) but I am open to correction on that.

If non-resident in either country then the tax you pay would be the UK payroll taxes deducted from your income, which is likely to be lower than the Irish taxes. However it is worth considering if transborder relief would make the effective Irish tax rate lower.

greengirl1968 · 30-04-2021 3:35pm

Thanks Relax - its not emergency tax apparently - my husband's accountant has told him that this is the correct rate as he has taken all of my tax credits

Its a bit messy as we are now separated and will need to separate our financial situation, at present we share a joint bank account which he pays into for myself and our child..anyhow I will talk to Revenue again next week, I've had to ask for a temporary password to access the account as it won't allow me log in

I heard somewhere that tax can be offset against a pension.. but anyhow will need to find out more

SureYWouldntYa · 30-04-2021 4:11pm

greengirl1968 wrote: »

I heard somewhere that tax can be offset against a pension.. but anyhow will need to find out more

Offset would be the wrong word

You can pay into a pension and it will reduce your income tax liability, it wont reduce your income assessable for usc or prsi however

If you pay 1000 into a pension it will reduce your income assessable for income tax by 1000. There is limits based on a percentage of your income depending on your age, you can google for yourself and see

The tax saving and its overall benefit will depend on what rate of tax you pay. If you’re at the 40% rate for a lot of your income, €1000 into your pension will reduce your assessable income by €1000 and save you €400 in tax, which means putting €1000 into your pension only cost you €600 when you account for the €400 saving in tax

Benny122 · 02-05-2021 1:09am

Ok guys I have a few questions please - someone might be able to help with.

My boyfriend has started a new job and his employer has but him down as a SUB CONTRACTOR!! So this means that he is self employed now!! And his wages are not taxed so we have been putting 40% tax away each week out of his pay packet cause we have no clue about any of this!

We will prob have to go an accountant at some stage I know!

I have been reading online am I correct in saying that he can be SELF EMPLOYED and a PAYE worker at the same time? How does this work?

I know the fact that he is self employed he can write off expenses again his tax bill such as petrol to work car tax services etc

I have also read that you can write 100% off cost of new low emission car off any new cars that are 0g/km - 50gkm? Is this correct?

So if my partner is on 52k per year and we bought a new Volvo XC 60 which would be more than his annual income how does that work!!

I am no good at accountant

Also if he was let go from this position in 1-2 years could he claim
Social welfare if he was within the thresholds

I guess I’m wondering really is be better off as a PAYE work or SELF EMPLOYEDor can he register for both

tmh106 · 02-05-2021 6:56am

Benny122 wrote: »

We will prob have to go an accountant at some stage I know!

To be honest, I think this is what you need to do now. You will get lots of good advice from people here I'm sure, but no one here is actually going to be able do the work to regularise your tax affairs or submit your returns. You can probably do a lot of it yourself based on what you learn here and elsewhere, but, initially at least, given as you say "you have no clue about any of this" you need someone who can review your situation and make sure anything you have done is correct and the most efficient for you from a tax point of view. Shop around for a good trustworthy accountant - talk to friends who may use one, or if you husband has colleagues in same situation see who they use.

You are setting aside 40% for tax, but I assume you will also have to pay PRSI and USC (I am not certain how these pertain to contractors). On the other hand, if you are setting aside 40% of gross pay, that is probably too much since you will (I assume, again not sure of contractor situation) be able to reduce gross with tax credits, plus some of you income will be on the 20% tax band and taxed at that rate, plus you will be able to use legitimate expenses (e.g. pension payments, health insurance, etc.) to reduce amount of gross pay that is eligible for tax.

Have a look at the Revenue website, they probably have information that that will help you. for example, I found this article: https://www.revenue.ie/en/jobs-and-pensions/calculating-your-income-tax/index.aspx

Good luck!

relax carry on · 02-05-2021 8:59am

Benny122 wrote: »

Ok guys I have a few questions please - someone might be able to help with.

My boyfriend has started a new job and his employer has but him down as a SUB CONTRACTOR!! So this means that he is self employed now!! And his wages are not taxed so we have been putting 40% tax away each week out of his pay packet cause we have no clue about any of this!

We will prob have to go an accountant at some stage I know!

I have been reading online am I correct in saying that he can be SELF EMPLOYED and a PAYE worker at the same time? How does this work?

I know the fact that he is self employed he can write off expenses again his tax bill such as petrol to work car tax services etc

I have also read that you can write 100% off cost of new low emission car off any new cars that are 0g/km - 50gkm? Is this correct?

So if my partner is on 52k per year and we bought a new Volvo XC 60 which would be more than his annual income how does that work!!

I am no good at accountant

Also if he was let go from this position in 1-2 years could he claim
Social welfare if he was within the thresholds

I guess I’m wondering really is be better off as a PAYE work or SELF EMPLOYEDor can he register for both

Time to talk to an accountant. Your boyfriend's new employer by deciding to make him self employed should be ringing alarm bells. It's to the employers advantage only and by your description above sounds like a bogus self employment situation. The link below explains more about the difference between self employed and employee.

https://www.revenue.ie/en/self-assessment-and-self-employment/construction-industry/are-you-self-employed-or-an-employee.aspx

BPPM · 15-06-2021 9:01pm

see a variety of payroll calculators https://www.bppm.ie/Payroll_Management/payroll.html

The_Kitty · 11-08-2021 10:13am

I transferred my prsa pension to a scheme work was offering. For the tax rebate on the pension will it be calculated at 20% or 40% or a mixture. Previously i was always completely on the lower rate of tax so am not sure. My wages have gone up to 38000. I hope this is not too personalised a question as I saw a pinned post on not to be looking for personalised tax calculation on this thread.

SureYWouldntYa · 11-08-2021 1:05pm

https://www.boards.ie/discussion/comment/117736580#Comment_117736580

The amount paid in will reduce your overall income liable to Income Tax.

If you paid in 5k when you salary is 50k, your reckonable income will be 45k for Income Tax purposes. Since all income above 35,300 is taxed at 40%, the effective relief will be 40% in this case. If you paid in 5k when your salary was 30k then the effective relief would be 20% since that 5k would have been taxed at 20%.

If you were to only pay in 2k then all your tax relief would be at 40% since you income for income tax purposes would be 36k

Driver1980 · 22-09-2021 8:38pm

Hi all have a question there.

I was getting PUP until today, I closed the claim, coming back to work now, registered my new job on the revenue yesterday got the amended tax certificate. I was getting the reduced 300PUP euro for this year, heard the weekly tax credits would cover that on this reduced amount. On my amended tax credit I get this as follows:

Rate Band 1 35,300.00 This Rate Band is decreased by: DSP PUP Payment 13,000.00 The amount of your income taxable at 20% 22,300.00

All income over €22,300.00 is taxable at 40%

This measn I will be taxted now until the end of the year at 40%? Why is the credit reduced so much by PUP? and it says 13 000 , it's like I got the 300e PUP until the end of the year which i didn;t. Should I call the revenue and ask?

A bit worried now that I will be taxed at 40%...

SureYWouldntYa · 22-09-2021 9:31pm

Go to My Enquiries on ROS online and you can request them to adjust your band rate to adjust for the actual PUP received, you can get that online on MyWelfare

They adjusted it as if you received it for the whole year because it was the simplest thing to do for everybody on PUP

Only when your earnings go above €22,300 in 2021 will you be taxed at 40%, but you’d need to be earning circa €1,500 a week for the rest of the year for that to be an issue

Tax Calculation Thread

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