USC & PRSI on 2nd income

[shweeney]

I'm PAYE, my wife has a small self-employed income and we're jointly assessed.

When she contacted Revenue about filing a return for 2014 she was told to submit 52% of her income from last year. However her income is well below the PRSI and USC thresholds and I thought these were both individualised so she should only be liable for income tax @ 41% - am I wrong here?

 

[T McGibney]

When she contacted Revenue about filing a return for 2014 she was told to submit 52% of her income from last year.

She shouldn't be paying much heed to the often inane "advice" given by Revenue staff. Nobody pays 52% of their income in tax because of the various thresholds and tax bands.

If her income is below the PRSI & USC thresholds, I can't really understand how she'd be paying 41% in individualised income tax either.

 

[shweeney]

If her income is below the PRSI & USC thresholds, I can't really understand how she'd be paying 41% in individualised income tax either.

we're jointly assessed and all thresholds and credits are assigned to me, so anything she earns is at the marginal rate (we could apply for the increased married couple standard-rate band, but I'm already claiming the home-carers credit and you can't do both). But she shouldn't be paying PRSI and USC is my understanding.

 

[Sophrosyne]

Yes, you are correct, if her relevant income is below the PRSI and USC thresholds.