How does tax work for freelancers in Ireland?

What tax will I pay in Ireland when I start back to work having given my tax credits to my wife?

• As my wife was on a higher wage when I was working last year, I was advised to give her my tax credits. This was fine at the time but then I was made unemployed and now have an interview and need to be able to know what my take home pay will be when they make an offer on a salary basis. ie if they offer me a basic of €25k per year, how much will I actually take home?? aprox. I am 42 years old. Thanking you in advance.

• Answer:

  By the sounds of it you are Jointly Assessed and that means that both incomes are added together and tax credits can be split between both of you. However the net result remains the same and although your wife enjoys lower tax at the moment when your tax affairs are reviewed the effect is still the same. Same applies if you take back your personal tax credit of 1830 per year. Your wife's income is still the same but it appears that she is paying more tax, well she is. But when reviewed at the end of the year the net effect between both incomes is still the same. On 25k with basic tax credits of 1830 (personal) and 1830 (PAYE) and a rate band of 20%, you will pay 1340 approx. However after some additional tax credits for service charges and medical expenses this can be seriously reduced further. If you combine all your earnings and this goes towards the family then the net effect is the same regardless if you transfer credits back to you or not. Please remember the PAYE credit is not transferable and rate bands could play a role also. Its hard to say but with further details about your wife and personal circumstances I could give you a more accurate result. Email me on [email protected] for further assistance.