Confused about Joint Assessment

Fatman Scoop

My income is 49,000 pa.
My wife has an income of 13,000 pa.
We got married in 2018.

Have been advised by a friend to fill out Assessable Spouse Election Form.

I have looked at it and do not understand how to fill it out.
Is it likely that our take-home pay will increase?

Can anybody advise how I might fill out this form.

We do not have any special tax credits, only standard, couple in our 30s, no children.

Stratvs

Take a look at this thread.

In particular from post #13 onwards.

Fatman Scoop

Stratvs wrote: »

Take a look at this thread.

In particular from post #13 onwards.

Thanks, I should have made better use of the search function

Seems I can just nominate myself as the assessable spouse, fill in our salaries and let Revenue fill in the blanks on the optimum way to split our credits?

Stratvs

Regarding standard rate cut-off point, on your figures of €49,000 self and €13,000 spouse the best you can get is €44,300 at 20% for you and up to €26,300 at 20% for her, but in this case that will be €13,000 at 20% for her.

As a single person you'd have been taxed at 40% on over €35,300 so you benefit to the tune of €44,300 - €35,300 = €9,000 at 20% instead of 40% so a saving of €1,800pa by being taxed jointly.

Also, on the tax credits side if the €13,000 is your wife's only income, then she is not utilising all of her credits of €3,300 ( €1,650 personal and €1,650 employee credit ) She only needs €2,600 to cover that and give her a nil tax deducted position. While you can't swap the employee credit between you, you can allocate some/all of the personal credit. So getting her to keep €2,600 keeps her with nil tax and means another €700 that you could get in credits. However if her earnings were likely to increase you may need her to keep a bit more.


As it currently stands the optimum result on the incomes you give would be :-
Tax Credits - assessable spouse ( you ) €4,000 - spouse €2,600 ( total of €6,600 )
Std Rate band - assessable spouse €44,300 - spouse €26,300

If you want to leave a bit of wiggle room on your wife's side you could leave the credits enough to cover say €14,000 so that would be €2,800 for her. If she doesn't use it, then on a year end review you could get that allocated to you and you'd get a refund. It wouldn't be lost. She'd still get up to €26,300 in cut-off anyway.

Stratvs

Separately, a year end review of 2018 as year of marriage may ( all other things being equal ) give refund depending on when in the year you were married. As the above joint system would be applied to the post-marriage period. Once Revenue have employment data on their systems ( employers have until mid-February to file those) or if you had P60s for 2018 you could submit a year of marriage review request.

Fatman Scoop

Very detailed, really appreciate your time on that Stratvs

SeaFields

Stratvs wrote: »

Separately, a year end review of 2018 as year of marriage may ( all other things being equal ) give refund depending on when in the year you were married. As the above joint system would be applied to the post-marriage period. Once Revenue have employment data on their systems ( employers have until mid-February to file those) or if you had P60s for 2018 you could submit a year of marriage review request.

Can I jump on this and ask about claiming retrospectively. We are married years but never occurred to be jointly assessed. Further to this, she has been on maternity leave a few times so I suspect we would have been better off being jointly assessed those years? So after I send in the assessable spouse form how do we ask for the last four years to be assessed?

relax carry on

SeaFields wrote: »

Can I jump on this and ask about claiming retrospectively. We are married years but never occurred to be jointly assessed. Further to this, she has been on maternity leave a few times so I suspect we would have been better off being jointly assessed those years? So after I send in the assessable spouse form how do we ask for the last four years to be assessed?

Yes you can send it in and just add a cover note requesting reviews under join assessment for the last 4 years. They'd do it anyway but no harm reminding them.

Stratvs

SeaFields wrote: »

Can I jump on this and ask about claiming retrospectively. We are married years but never occurred to be jointly assessed. Further to this, she has been on maternity leave a few times so I suspect we would have been better off being jointly assessed those years? So after I send in the assessable spouse form how do we ask for the last four years to be assessed?

Might also be worth including Med1 claims if you have unreimbursed medical expenses over that period.

SeaFields

Stratvs wrote: »

Might also be worth including Med1 claims if you have unreimbursed medical expenses over that period.

Thanks stratvs. Yes I've claimed the medical expenses every year.

lotsofthegreen

Married Couple

Husband €40k Gross
Wife €20k Gross

Can anyone tell the annual tax saving assuming normal tax credits if jointly assessed as opposed to standard assessment please

namenotavailablE

Joint assessment will allow a transfer of a portion (€4700) of the wife's standard rate band to the husband in the above scenario as she doesn't need anything above €20000.

This would mean that the husband would see his net income increase by €940 in the year [€4700 x (40%-20%)] and there would be no adverse impact on the wife's take home pay. If the couple opted for 'separate assessment', they would need to wait until the end of the year to request a review of their tax liability to get the refund (so it would be a timing impact, not a cash impact). Opting for 'single assessment' (aka 'separate treatment') means that each person is taxed as a single person.

See this page and following ones for more information:

https://www.revenue.ie/en/life-events-and-personal-circumstances/marital-status/marriage-and-civil-partnerships/joint-assessment.aspx

lotsofthegreen

namenotavailabl wrote: »

Joint assessment will allow a transfer of a portion (€4700) of the wife's standard rate band to the husband in the above scenario as she doesn't need anything above €20000.

This would mean that the husband would see his net income increase by €940 in the year [€4700 x (40%-20%)] and there would be no adverse impact on the wife's take home pay. If the couple opted for 'separate assessment', they would need to wait until the end of the year to request a review of their tax liability to get the refund (so it would be a timing impact, not a cash impact). Opting for 'single assessment' (aka 'separate treatment') means that each person is taxed as a single person.

See this page and following ones for more information:



https://www.revenue.ie/en/life-events-and-personal-circumstances/marital-status/marriage-and-civil-partnerships/joint-assessment.aspx

Thank you

SeaFields

Hopefully final question on this topic. We completed the assessable spouse form. I scanned it into the computer and attached it to a enquiry on my paye online account. Will this be processed or should I have posted it? I tried ringing revenue but lines always busy!

Stratvs

SeaFields wrote: »

Hopefully final question on this topic. We completed the assessable spouse form. I scanned it into the computer and attached it to a enquiry on my paye online account. Will this be processed or should I have posted it? I tried ringing revenue but lines always busy!

It should still be processed but MyEnquiries replies can often take up to a month.

SeaFields

Thanks again Stravts

GampDub

I know this thread has already been slightly hijacked but hope you dont mind me slightly hijacking too - if it helps I too am confused about Joint Assessment!

I too am married a number of years (4 this coming June) and never thought to get Jointly Assessed - both myself and wife earn roughly on par with each other (circa. 45-50k pa each) during that period. She previously earned more than me but I have surpassed her in recent months. In scenarios where both partners are earning similar and above 45k is joint assessment still worthwhile to reduce overall tax paid?

Thanks

Stratvs

GampDub wrote: »

I know this thread has already been slightly hijacked but hope you dont mind me slightly hijacking too - if it helps I too am confused about Joint Assessment!

I too am married a number of years (4 this coming June) and never thought to get Jointly Assessed - both myself and wife earn roughly on par with each other (circa. 45-50k pa each) during that period. She previously earned more than me but I have surpassed her in recent months. In scenarios where both partners are earning similar and above 45k is joint assessment still worthwhile to reduce overall tax paid?

Thanks

Where both earn €45K+ and are currently taxed singly, joint assessment wouldn't reduce the overall Income Tax paid.

Currently, taxed singly you've €34,500 at the low rate. Joint assessment it's €69,100 but no spouse can have more than €43,500 of that. As both earn €45,000+ there's no unused transferable standard rate band.

GampDub

Stratvs wrote: »

Where both earn €45K+ and are currently taxed singly, joint assessment wouldn't reduce the overall Income Tax paid.

Currently, taxed singly you've €34,500 at the low rate. Joint assessment it's €69,100 but no spouse can have more than €43,500 of that. As both earn €45,000+ there's no unused transferable standard rate band.

Thanks - so best to remain taxed singly or would there potentially be any benefits to being taxed as a married couple?

Stratvs

GampDub wrote: »

Thanks - so best to remain taxed singly or would there potentially be any benefits to being taxed as a married couple?

Taxed singly there is no crossover between your credits/cut-off. Taxed jointly there may be circumstances/credits/reliefs arise which could benefit. Suppose one or other took unpaid leave and that spouse's earnings dropped significantly then there could be benefit there. One can always change basis down the line though.

fiestaman

SeaFields wrote: »

Hopefully final question on this topic. We completed the assessable spouse form. I scanned it into the computer and attached it to a enquiry on my paye online account. Will this be processed or should I have posted it? I tried ringing revenue but lines always busy!

Hi resurrecting this thread as I'm in a similar boat. When you submitted the form and asked to be accessed for previous years did you get a return, or had you to submit anymore info.
We're married 4yrs this June and we never changed to joint. I'm earning between 30&40k depending on commision and wife earns 17k. Can I fill out the assessable spouse form, put me down as the main spouse, add letter to access previous 4yrs and post.