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Married couple taxation in Ireland

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  • 19-01-2023 11:37am
    #1
    P.E.K.K.A
    Registered Users Posts: 9 ✭


    Hello everyone, I got married and I need to change the civil status on the revenue website and I have seen multiple options (3 to be exact)

    Did some search and found this website:

    taxback(dot)com/blog/marriage-and-tax-savings/ (can't post links yet)

    Options there are

    (1) Assessment as a single person

    (2) Separate assessment

    (3) Joint assessment

    As a foreigner and a person that isn't really good with finance/economy related matters, also not wanting to fail to correctly set this because of lack of information, I thought I would be asking here for people that are better informed than I am to help me ramp myself up. I guess I am asking for a layman terms explanation please.

    To my understanding, for married couples "Joint assessment" is considered the better option, I need a confirmation if it is indeed?

    Also which spouse is better be nominated, does matter which of them is the assessed one? Say one of them has a very high salary and another has a low one, is it better to nominate one of them to be assessed over the other based on salary? Is there any other criteria to make this decision? Is there anything that I should keep in mind/pay attention to or any tip that you can give me to help me make this change/decision?

    It is very much appreciated any help that I can receive and thank you in advance.

    Tagged:


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    #2
    crisco10
    Registered Users Posts: 6,200 ✭✭✭crisco10


    It depends on the relative salaries if it's worth doing. If one of the salaries is less than €40k or so, it's worth being joint assessed as the higher earner can avail of the lower earners unused tax credits.

    If both salaries are above €40k and in higher tax bracket, the benefit is not there.

    For example, when my wife wasn't working Joint Assessment worked well for us as I used my credits and a lot of hers (you can't transfer them all), but now she is back to work with €50k salary, the joint assessment makes little difference.



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    #3
    P.E.K.K.A
    Registered Users Posts: 9 ✭P.E.K.K.A


    https://www.boards.ie/discussion/comment/120128299#Comment_120128299

    One of the salaries is above 70K, and the other is nearly 30-32K (near minimum wage). So as understand from your response, joint assessment is beneficial, does it matter which spouse is the assessed one?



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    #4
    relax carry on
    Registered Users Posts: 4,079 ✭✭✭relax carry on


    Not really, though traditionally it's the higher earner.


    As an aside, you won't benefit from your spouses unused tax credits as they are actually using all of them. You will benefit from their unused rate band. There are 2 parts to the PAYE system Rate and and tax credits. People get them mixed up all the time.

    Assuming your pause is only going to earn 32000 euro in 2023, you can take 8000 euro of their rate band without impacting them. It means a saving of 8000 euro by 20% (1600 euro) for you in the tax year.



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    #5
    Prospector1989
    Registered Users Posts: 212 ✭✭Prospector1989


    Piggybacking on this thread.

    Not looking for figures etc.

    Me : Salary ~62k

    Wife (job sharing) : Salary ~23k

    I only "joined" our taxes towards the end of last year. Completed our tax return for 2022 and her information was available etc.

    I got my first payslip since joining the taxes and I'm only up about €60. Assuming that's to do with the various tax band changes. Should I have expected more? What should I be looking out for? On my payslip or on revenue? I can see when I log in to revenue, "Personal tax credit" is marked as "Shared"



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    #6
    Prospector1989
    Registered Users Posts: 212 ✭✭Prospector1989


    If I'm correct I think unless I specify somewhere on the revenue website, are the tax credits all still split?



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    #7
    relax carry on
    Registered Users Posts: 4,079 ✭✭✭relax carry on


    https://www.boards.ie/discussion/comment/120157470#Comment_120157470

    Unless you specify then the credits stay as they were. Also your spouse is using all their tax credits on their income so there nothing to share there. They aren't using all of their rate band so you can transfer 9000 euro of it to yourself.



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    #8
    chrismcc409
    Registered Users Posts: 119 ✭✭chrismcc409


    Can anyone tell me how you do this transfer. We are both on ros but can't see it there. My wife has filed 2022 so I want to transger the 9k band to me now. Is it just a matter of contacting revenue?



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    #9
    relax carry on
    Registered Users Posts: 4,079 ✭✭✭relax carry on


    Are you already listed as jointly assessed? If so what tax year as re you talking about 2022 or 2023 the active tax year.



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    #10
    downtheroad
    Registered Users Posts: 3,032 ✭✭✭downtheroad


    https://www.boards.ie/discussion/comment/121022225#Comment_121022225

    Were you already jointly assessed for 2022? revenue don't backdate joint assessment.



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    #11
    chrismcc409
    Registered Users Posts: 119 ✭✭chrismcc409


    https://www.boards.ie/discussion/comment/121035572#Comment_121035572

    Not jointly assessed but separately assessed. We have both done separate assessment since 2013 but you can transfer under "separate assessment". You can't transfer under "separate treatment" . I just don't know how and am none the wiser after 2 hours on the phone to revenue yesterday. One person told us it should be simple to transfer but she was wrong department so she transferred us. The next person told hummed and hawed for about 5 minutes then told both to file for 2022 and it would magically work.



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    #12
    downtheroad
    Registered Users Posts: 3,032 ✭✭✭downtheroad


    https://www.boards.ie/discussion/comment/121046780#Comment_121046780

    Out of pure curiosity why do you do separate assessment instead of joint?



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    #13
    relax carry on
    Registered Users Posts: 4,079 ✭✭✭relax carry on


    https://www.boards.ie/discussion/comment/121046780#Comment_121046780

    There is not automatic transfer under separate assessment. You both have to file a tax return under separate assessment and then send a myenquiry to ask Revenue to check if there is any unused rate band/credits for the year(s) you filed the tax return (s) for which can be transferred to the other spouse.

    Under joint assessment, you get the exact same result but you only file one tax return and any used rate band/credits are automatically used in calculating the result of the tax return filed.



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