Sarah is a PAYE employee. She is married and is taxed under joint assessment. Her husband, David, is not employed outside the home. They have a dependent child. Sarah is entitled to claim the Home Carer Tax Credit.
Sarah's tax credits for 2022
|Married Person’s Tax Credit
|Employee Tax Credit
|Home Carer Tax Credit
|Total tax credits
||€6,700 per year (€128.77 per week)
Because Sarah is married, and her husband does not have an income, her rate band is €45,800 per year. The weekly amount is €880.77 (€45,800/52).
Sarah was given a Tax Credit Certificate showing these tax credits and rate band. Her employer was given an RPN with the total amounts.
Sarah earns €1,100 per week. Her weekly tax is calculated by applying the standard rate of tax (20%) to the first €880.87 (up to the limit of Sarah's rate band).
The higher rate of tax (40%) is applied to the last €219.23 (€1,100 – €880.77) of her income above the rate band.
How Sarah's weekly tax is calculated
|Taxed at standard rate
||€880.77 x 20%
|Taxed at higher rate
||€219.23 x 40%
|Deduct tax credits