Married and Single Tax credit

MiakaC

Hi there,

I saw there are already some threads on this topic but no one seem to touch my question.
I noticed in the example on the revenue website the tax credit relief for a married under joint assessment is 4950 (including the PAYE tax credit). When the two are under separate assessment or separate treatment it's always considered 1650 + 1650 for one of the spouses and only single tax credit (no PAYE) for the other spouse. So under any of the cases the total relief is 4950. As single each of the two as both the single and the PAYE tax credit...making up a total of 6600. So I'm not clear which if the benefit of going under the married assessment if there is no benefit for unused standard rate band? I'm not losing 1650 per year? Maybe I'm not considering something?

Thanks for your answers!

Stratvs

If I’m reading you correctly you wonder why single is 3300 each but married is 4950. That is because 4950 is the most either spouse can take from joint credits. They can take their own 1650 personal credit, the spouses 1650 personal credit and their own 1650 PAYE credit. If the other spouse is working they retain their own 1650 PAYE credit. The PAYE credit is not transferable between spouses.

Allocation of the standard rate band between spouses is a different matter to be considered depending on the respective incomes of the spouses.

MiakaC

Stratvs wrote: »

If I’m reading you correctly you wonder why single is 3300 each but married is 4950. That is because 4950 is the most either spouse can take from joint credits. They can take their own 1650 personal credit, the spouses 1650 personal credit and their own 1650 PAYE credit. If the other spouse is working they retain their own 1650 PAYE credit. The PAYE credit is not transferable between spouses.

Allocation of the standard rate band between spouses is a different matter to be considered depending on the respective incomes of the spouses.

So you say they are only showing what is potentially transferable but the extra PAYE credit for the second spouse is still there, is this correct?

Thanks!

lashes34

MiakaC wrote: »

So you say they are only showing what is potentially transferable but the extra PAYE credit for the second spouse is still there, is this correct?

Thanks!

Yes, everyone has 1650 PAYE and 1650 personal credits. 1650 isn't transferable. You don't lose 1650 unless the second person isn't working or they aren't using the full credit then you don't get the full benefit but you can transfer one of the 1650s so its something.

Stratvs

MiakaC wrote: »

So you say they are only showing what is potentially transferable but the extra PAYE credit for the second spouse is still there, is this correct?

Thanks!

Yes, as explained in lashes34 post above.