I've been trying to understand the full scenario around the Home Care Tax Credit.
Looking at Example 3 here in the government budget example scenarios http://www.budget.gov.ie/Budgets/2019/Documents/2. Budget 2019 Tax Policy Changes.pdf
, for 70k Household income, 1 child, it shows an increase of 13,140-12,690, of which I understand 150 is due to the marginal rate increase and 300 due to the increase in the Home Carer Tax Credit.
I'm trying to understand the detail of this. Do this mean that in 2019, if my spouses income were below 7,200 that I could have the full 43,550 standard cut-off rate and she would pay no PAYE tax as her Personal Tax Credit is 1,650?
the Home Carer credit is worth 1500 this year. So if 20%* of the second persons income is less than 1500 (i.e. total taxable is < 7500) you should claim the carers credit. Otherwise claim the increased standard rate band.
*(20% being the difference between high rate and standard rate PAYE)