Can we backdate 3 years from Jointly assessed to singularly assessed?

Listen67

Registered User
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Hi All,

We are a married couple:
I work in Northern Ireland paying tax as a PAYE in the north.
My wife works in the South and pays tax as PAYE in the south.
We have two rental properties in the south, one in my wifes name and one in my name.

Because of the rental properties we have an accountant who files our Income tax returns for us. As part of this process both our incomes PAYE and Rental income are calculated (again) and the Crossborder allowance is applied.
This gives us the additional tax we should pay per year.

For the last 3 years this additional tax has come to about €4,700.

However, we have asked our accountant to perform a test and calculate our tax as if we were individually accessed.

The new figure has come out at a reduced €3,003.
That would mean that by being singularly accessed would save us approx whopping €1,700 per year.

We have been paying tax like this for 3 years so in essence we have overpaid tax by €5,100

We are going to apply to be singularly taxed for 2015, however how can we get back the €5,100 we have overpaid?

It appears that the rules state that you cannot backdate to being singularly accessed for tax.. in other words we cannot get this money back.

Does anyone have any knowledge about this or ideas how we may get this overpaid tax back?

thanks in advance
 
No you cannot backdate separate assessment - you are even too late to opt for it for 2014 as you must do so before the end of March for the year in question.

The other option is separate treatment (completely separate affairs) you can opt for that at any stage during the year - so you can still apply for 2014 for this basis of assessment.

I'm not entirely sure how you have a lower liability when assessed separately - as joint assessment should not provide any disadvantage. Presumably you are getting transborder relief? Which should effectively remove your UK income from further taxation? Therefore you are only paying tax on the rental income.

I'm presuming that you are Irish resident?
 
Thanks LillyAllen.

Yes, we are using Transborder relief.
Below are the actual calculations that show the difference.

It seems extraordinary that we have been told that being jointly assessed will have no detrimental effect on our tax and yet below shows a large over-payment. And we can't claim it back!

I wonder could you explain the difference between separately assessed and separate treatment?

Here are the figures:
My figures:
UK income (converted to Euro) €56,163
Rental income €4,214
Total income €60,377
Tax liability: €14,567

My spouse’s figures:
Irl income €38,612
Rental income €2,583
Total income €41,195
Tax liability: €6,702

Combined tax Liability: €21,269
Combined Total income: €101,572

Transborder relief:
Irish tax liability X (income other than UK / Total income) = adjusted tax liability

Joint assessed:
21,269 X (101,572 -56,163) / 101,572 = €9,509

Singularly assessed:
14,567 X (60,377 - 56,163) / 60,377 = €1,016

Combined tax payable:
Jointly assessed = €9,509

Singularly assessed = (Spouse tax + my tax) = 6,702 + 1,016 = €7,718

Tax savings: = 9,509 - 7,718 = €1,791
 
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