Moving my tax credits to my husband??

[muffin1973]

Hi all

Have taken unpaid leave from my job but might be leaving altogether. Can anyone point me in the right direction or tell me how much more my husband would get if I moved my tax credits to him? He earns Eur60k and I earn around Eur40k per year before tax.

any help would be appreciated.

M

 

[mandelbrot]

Hi all

Have taken unpaid leave from my job but might be leaving altogether. Can anyone point me in the right direction or tell me how much more my husband would get if I moved my tax credits to him? He earns Eur60k and I earn around Eur40k per year before tax.

any help would be appreciated.

M

It depends on how the credits and standard rate band are split between ye at present...

But assuming everything is split down the middle, if you stopped working altogether (i.e. income dropped to nil for the year):

You could transfer an additional 9k of standard rate band to him, so he would pay tax @ 20% on that 9k, rather than @ 41% that he is presently, so that is worth €1,890 [9k x (41%-20%)].

You can also transfer your personal tax credit to him (or your half of the marriage credit, strictly speaking), which is €1,650 at present.

So that would mean his net pay would increase by €3,540.

Also if you have kids you may be able to claim the home carer's tax credit, which would be worth a further €810, and this can be transferred to him.

As I said though, this is hypothetical, as it depends on what way things are currently split.

 

[muffin1973]

Hi Mandelbrot,

thanks so much for your detailed answer. Yeah everything is split down the middle, so he'd only get around Eur3,500 extra a year if i transferred over my credits? Thought it would have been more than that. We don't have kids...

anyway, thanks again

M

 

[bacchus]

You could transfer an additional 9k of standard rate band to him, so he would pay tax @ 20% on that 9k, rather than @ 41% that he is presently, so that is worth €1,890 [9k x (41%-20%)].

How did you come up with 9k?

 

[xeresod]

How did you come up with 9k?

If both had their rate split equally, ie 32800 each, then 9K is the maximum additional rate band he can benefit from as a married couple with only one income which is 41k. See here.