IFF taxation consultation thread (1 Viewer)

[IFF]

welcome. upon suggestion of jane, if you need any tax advice, just ask it here and i will try my best to answer it

could this be stickied?

 

[krystal]

Dear Iff,

Why do I have to pay tax?

 

[IFF]

public services, to entice politicians not to take kickbacks (by giving them alot of money), sunshine and people who don't want to work

 

[jane]

Hey hey! Thanks, IFF!

Actually, i've got a question already.

I don't actually make enough to end up owing any tax (because I'm a dumb shit willing to put in 16 hour days for a pittance), but Mr Jane makes okay money.

What happens when we file as a married couple? Are we better off filing jointly or individually? Are we allowed to file individually?

 

[coraline]

Hey hey! Thanks, IFF!

Actually, i've got a question already.

I don't actually make enough to end up owing any tax (because I'm a dumb shit willing to put in 16 hour days for a pittance), but Mr Jane makes okay money.

What happens when we file as a married couple? Are we better off filing jointly or individually? Are we allowed to file individually?

I think I know this one !!!
You can opt for separate assessment rather than joint assessment when you get married.
As far as I know it used to be that joint assessment was the only option and it involved the higher earner, usually the man, getting proportionally more of the tax credits and stuff, with the lower earner getting a nasty nasty tax bill.
With separate assessment the total amount of tax you end up paying as a couple is the same but it's shared out equally between you.
That's what we'll be doing anyway.....

http://www.revenue.ie/index.htm?/services/ind_per2.htm

 

[jane]

See, the thing is, I make so little money that on my own, I don't even make the lowest tax band. So if tax credits are shared out between us, would I end up paying tax anyway because I'm no longer entitled to as many? I still don't really get it.

It's all in theory anyway, since paychecks are not forthcoming and now I can't do paid work until after the wedding. thanks to the fucking immigration system, there are a few people in this town who've just been given about a ten thousand euro loan for free, by me. Which is about half a year's pay.

Do all the bad debts owed to me get written off on tax? Like, do we still have to pay tax on money I have only earned on paper, or can we write that off against Mr Jane's salary since that's all we have to live on? I mean, I can show invoices and sleepless nights and tears of rage as well as despair. We're gonna get an accountant to help us, but I'm not even sure how to ask these questions. I've never made enough money for any of it to matter, and my taxation as a student was always PAYE. Apparently I was entitled to get loads of it back, which I could never figure out how to do ,although I did once get given a phone number and told to request some sort of form which was followed by an unexpected check for about 500 pounds, which was kaching and made me not hate paying tax so much when the Irish system is a bit easier on the low-earner than a lot of other systems.

PS: Mr Jane also says that I have to obey him now -- is this true? Now I'm REALLY confused.

 

[krystal]

See, the thing is, I make so little money that on my own, I don't even make the lowest tax band. So if tax credits are shared out between us, would I end up paying tax anyway because I'm no longer entitled to as many? I still don't really get it.

.

if you're taxed as you, and you don't make the threshold, then you don't pay tax, just as if you were single. It's a bit fairer than it was, it seems to me in anyways.

edit: also will answer other q's tomorrow, which is handy, as I am in the middle of something on same.

 

[pete]

I am in the middle of something on same.

a wedding?

 

[jane]

if you're taxed as you, and you don't make the threshold, then you don't pay tax, just as if you were single. It's a bit fairer than it was, it seems to me in anyways.

edit: also will answer other q's tomorrow, which is handy, as I am in the middle of something on same.

Class, that's what I was hoping, and that's way fairer.

I mean, ultimately, we both come out a little better, even if I do end up paying some more tax because duh, sharing two salaries between us, but I think it would be a bit crap to tax a low earner for getting married, as if their measly salary was inconsequential or somehow suddenly just a 'vanity' job.

The revamped tax system does seem a bit more sensible, even if they haven't copped on to the fact that taxing the super-rich would solve a lot more problems than just letting us workaday folk write off a few more things. But hey, I'm not complaining about being able to write-off a few more things.

Anyroads, so I think the key is to ask an accountant about specifics: if filing jointly means Mr Jane gets more money in tax breaks than we would save by my paying no tax if we file separately, then we file jointly. If not, then we file as individuals.

I know nothing about taxes and revenue-speak confuses the christ out of me.

 

[Mormon Nailer]

I think I know this one !!!
You can opt for separate assessment rather than joint assessment when you get married.
As far as I know it used to be that joint assessment was the only option and it involved the higher earner, usually the man, getting proportionally more of the tax credits and stuff, with the lower earner getting a nasty nasty tax bill.
With separate assessment the total amount of tax you end up paying as a couple is the same but it's shared out equally between you.
That's what we'll be doing anyway.....

http://www.revenue.ie/index.htm?/services/ind_per2.htm

Back in the day, when I used to work in practice the offices here in town used to take it in turns to send some to the citizens advice bureau once a week. People would come and ask unanswerable questions and I'd try and come up with some plausible bullshit.

Anyway

This dude came in who had a problem with his pay - as in all of a sudden he was getting fuck all. He had complained to the payroll girl where he worked but she was adamant the calculations were right and his allowances were as given by th revenue.

What had happened was he was separated from his wife but they still had joint assessment so she went into the tax office and snaffled all his tax free allowances and lower rate bands. She had everything put on her cert and he had to pay everything at the top rate with no allowances.

Clever little shrew.

 

[krystal]

a wedding?

no.

 

[IFF]

I think I know this one !!!
You can opt for separate assessment rather than joint assessment when you get married.
As far as I know it used to be that joint assessment was the only option and it involved the higher earner, usually the man, getting proportionally more of the tax credits and stuff, with the lower earner getting a nasty nasty tax bill.
With separate assessment the total amount of tax you end up paying as a couple is the same but it's shared out equally between you.
That's what we'll be doing anyway.....

http://www.revenue.ie/index.htm?/services/ind_per2.htm

correct. a benefit of this is that the net liability (as if they were under joint assessment as opposed to married but separate) of the husband and wife are the same but the liability is divided between them

it is beneficial to be married but separate as opposed to single assessment

See, the thing is, I make so little money that on my own, I don't even make the lowest tax band. So if tax credits are shared out between us, would I end up paying tax anyway because I'm no longer entitled to as many? I still don't really get it.

the way to do it would be that you take your 1.2 of the married credit €1,830 (2008 figure) and use it. then the unused portion could go to mr. jane

Do all the bad debts owed to me get written off on tax? Like, do we still have to pay tax on money I have only earned on paper, or can we write that off against Mr Jane's salary since that's all we have to live on?

Debtor amounts are included in tax return. However, if the debt is uncollectable, these can be deducted from tax.

On vat, there is an option to account for vat on cash receipts basis but sadly, there is no such option for income tax.

If the debt was uncollectable, then it could be set against Mr Jane's income. However, a loss can only be set against income in the year. If it's written off as uncollectable in 2007 (a from my reading of it, you and Mr Jane are planning a wedding), it couldn't be set off. However if it's written off as uncollectable in 2008, it can be set off against his income.

A loss in the year of a loss can be set against other income. however, if the loss is not used in the year it is occured, you can only set it against income from that trade or profession.

PS: Mr Jane also says that I have to obey him now -- is this true?

No. In marraige, it's always the women that needs to be obeyed.

i hope this has clarified things. if not, ask

 

[carbide]

dear IFF,

if you've doubts that the tax they deducted was correctly reported by a former employer, but you're not sure enough to fly into concrete accusations, is it worth sending payslips and a note to revenue without certainty? what does the recipient really want in a letter like that? which lucky department should be receiving it?

(backstory: temp agencies are, almost without fail, evil motherfuckers. i get huge refund from 3 months in one place, but i don't get anything beyond small change from 6 months in the same place the previous year. i realise i had a year full of tax credits for 3 months in one case, etc, but i really didn't get near my tax-free allowance for the year in either case.)

bonus question: how do you know which your local tax office is? is it where you live, where you first registered, where you work....? i figured this out before but have completely forgotten.

 

[Mormon Nailer]

dear IFF,

if you've doubts that the tax they deducted was correctly reported by a former employer, but you're not sure enough to fly into concrete accusations, is it worth sending payslips and a note to revenue without certainty? what does the recipient really want in a letter like that? which lucky department should be receiving it?

(backstory: temp agencies are, almost without fail, evil motherfuckers. i get huge refund from 3 months in one place, but i don't get anything beyond small change from 6 months in the same place the previous year. i realise i had a year full of tax credits for 3 months in one case, etc, but i really didn't get near my tax-free allowance for the year in either case.)

bonus question: how do you know which your local tax office is? is it where you live, where you first registered, where you work....? i figured this out before but have completely forgotten.

Go to the revenue office and ask for a balancing statement for the years in question. If your deductions have been calculated incorrectly you can get a refund - I think there is a 4 year timeframe for this. You wont need payslips but a P60 or P45 would be helpful.

They are pretty helpful in the revenue and they are not out to screw you.

Whether your employer at the time was returning the tax correctly is a slightly different matter. Most impotant thing from your perspective is did they give me the correct net pay based on my allowances.

Anything beyond that is between them and the revenue.

 

[carbide]

Go to the revenue office and ask for a balancing statement for the years in question. If your deductions have been calculated incorrectly you can get a refund - I think there is a 4 year timeframe for this. You wont need payslips but a P60 or P45 would be helpful.

They are pretty helpful in the revenue and they are not out to screw you.

Whether your employer at the time was returning the tax correctly is a slightly different matter. Most impotant thing from your perspective is did they give me the correct net pay based on my allowances.

Anything beyond that is between them and the revenue.

cheers. it's the last bit that's the problem - things came out funny when i got balancing statements for the last 4 years, where the expected big refund was almost non-existent. i agree about revenue being helpful, and they were super-lovely when i was trying to unravel the mess i made of something separate.

i think they under-reported the tax i paid, and this makes me wonder if they declared what i was earning accurately, because surely one would highlight problems with the other. i don't really know enough about tax to sit down with all the documentation and figure out the problem.

 

[Mormon Nailer]

cheers. it's the last bit that's the problem - things came out funny when i got balancing statements for the last 4 years, where the expected big refund was almost non-existent. i agree about revenue being helpful, and they were super-lovely when i was trying to unravel the mess i made of something separate.

i think they under-reported the tax i paid, and this makes me wonder if they declared what i was earning accurately, because surely one would highlight problems with the other. i don't really know enough about tax to sit down with all the documentation and figure out the problem.

Does you gross pay agree to what's on the balancing statements would be the first question to ask.

Second question would be were my allowances right.

Third and final question would be based on those what tax should I pay and what tax did I actually pay.

I wouldn't obsess too much about what your old employer did or didn't do - just stick to ensuring you agree with the gross income shown on the balancing statement.

That what I'd do anyway.
Pehaps IFF has a different perspective.

 

[carbide]

Does you gross pay agree to what's on the balancing statements would be the first question to ask.

Second question would be were my allowances right.

Third and final question would be based on those what tax should I pay and what tax did I actually pay.

I wouldn't obsess too much about what your old employer did or didn't do - just stick to ensuring you agree with the gross income shown on the balancing statement.

That what I'd do anyway.
Pehaps IFF has a different perspective.

yeah, i understand that - i only give a damn about what they did as far as it concerns me, and what i was really asking was how to dispute it if i find that one of those questions is an issue. i might be phrasing badly but i'm not remotely obsessing.

 

[Mormon Nailer]

yeah, i understand that - i only give a damn about what they did as far as it concerns me, and what i was really asking was how to dispute it if i find that one of those questions is an issue. i might be phrasing badly but i'm not remotely obsessing.

If it turns out your Gross is as you expect and that you paid too much tax on that because the employer fucked something up then theres no problem revenue will issue you a refund.

If however you can't understand the Gross figure on the balancing statement - for example it's much less than you expect - then there could be a bit of a problem. Did, for example, the employer underpay you and you never spot it. There's not much the revenue can do for you in that case.

 

[IFF]

If it turns out your Gross is as you expect and that you paid too much tax on that because the employer fucked something up then theres no problem revenue will issue you a refund.

carbide - the pay slip you have should have net pay on it, usually the last line or so. this should match what you've recieved in your bank account as it takes into account he deductions (paye, prsi ee, pension, union dues etc). obviously there's an information gap here. we don't get bank statements the same day we get payslips

nailer is right also. if tax is overpaid, you can contact tax office

if they have underpaid you, you can bring it up with the employer. Now if this is unsuccessful (and i suspect it will be), the rights commsioner is the next step. a complaint form is downloadable (in pdf form) from http://www.lrc.ie/documents/work/newforms/PaymentWages.pdf

information pager about the rights commisioner is http://www.lrc.ie/docs/Rights_Commissioner_Service__Information_about_the_service/234.htm

bonus question
your tax office would be the the tax office where the revenue have you registered as living currently. they will be sending out tax credit information next month and this would should show the tax office address

also go to: http://www.revenue.ie/index.htm?/cont_main.htm and source the correct region

hope this helps

 

[Diddles]

Dear IFF,

What's the story with PRSI for a self-employed person? I paid tax last October for 2006 and prelim for 2007. I only got a receipt from the tax office saying I have paid money to them, but it doesn't mention any PRSI contribution.

As far as I can figure out from the internets the Revenue take the PRSI out of me tax and I don't have to do anything myself. Is this true?

Am I entitled to claim PRSI benefit type stuff?

Please say yes or I am fucked.