top slicing relief

  • Thread starter Thread starter patrickm
  • Start date Start date
P

patrickm

Guest
My wife was made redundant and is entitled to TSR,when recieving redundancy she was assesed as an individual,even though we were jointly assesed previously.Now revenue say for TSR she will be assesed jointly again is this the case?can anybody advise?
 
Revenue calculate the top slicing relief based on both Joint Assessment and Separate Assessment and give the relief that calculates as the most beneficial. In order to calculate the Top slicing relief they would need the income and tax details for both spouse's for the year the redundancy was paid and the previous 3 years. Whereas the taxable portion of the redundancy would have been taxed based on the tax credits and standard rate cut off point allocated to your wifes employment at the time of the redundancy.
 
Tsr

Thankyou that clarifies things.My wife originally claimed on her own in January.I didnt send any returns of my own.So no word from revenue.They would wait till end of year and then say they needed mine,I'll get them off asap.THANKS.
 
patrickm said:
Thankyou that clarifies things.My wife originally claimed on her own in January.I didnt send any returns of my own.So no word from revenue.They would wait till end of year and then say they needed mine,I'll get them off asap.THANKS.
Click to expand...

Are you saying your wife was made redundant in January 2012? If so, TSR cannot be claimed until after the year is over. TSR works by ensuring that the rate of tax paid in the year the redundancy is received is not higher than that paid in the previous 3. So all of 2012's income details for both spouses will be needed before the calculation of the relief can be done.
 
No sorry made redundant in dec 2011,claimed tsr in Jan 2012.Thanks
 
I thought that TSR was based on the average rate of tax paid over the previous three tax years. Therefore, someone claiming TSR in respect of a payment made in 2011 would base the claim on their average tax rate from 2008 to 2010, or have I got this wrong?

Homer
 
Homer said:
I thought that TSR was based on the average rate of tax paid over the previous three tax years. Therefore, someone claiming TSR in respect of a payment made in 2011 would base the claim on their average tax rate from 2008 to 2010, or have I got this wrong?

Homer
Click to expand...

That's correct
 
From what I can remember, the Revenue site doesn't actually specify whether it's last 3 complete tax years or last 3 years to date-of-redundancy
 
DB74 said:
From what I can remember, the Revenue site doesn't actually specify whether it's last 3 complete tax years or last 3 years to date-of-redundancy
Click to expand...

From Schedule 3 to TCA 97:

PART 3 Relief by reduction of tax

10 In the case of any payment in respect of which income tax is chargeable under section 123, relief shall be allowed by means of deduction from the tax chargeable by virtue of that section of an amount equal to the amount determined by the formula-
A - (P x T)
I
where-
A is the amount of income tax which apart from this paragraph would be chargeable in respect of the total income of the holder or past holder of the office or employment for the year of assessment of which the payment is treated as income after deducting from that amount of tax the amount of tax which would be so chargeable if the payment had not been made,
P is the amount of that payment after deducting any relief applicable to that payment under the preceding provisions of this Schedule,
T is the aggregate of the amounts of [income tax payable]1 in respect of the total income of the holder or past holder of the office or employment for the [3 years]2 of assessment preceding the year of assessment of which the payment is treated as income before taking account of any relief provided by section 826, and
I is the aggregate of the taxable incomes of the holder or past holder of the office or employment for the [3 years]2 of assessment preceding the year of assessment of which the payment is treated as income.
 
You must log in or register to reply here.
Back
Top