Tuesday 20 February 2018

Couple living together

Income €122,000

Verdict €211 monthly loss

Carol and Eoin are living together in rented accommodation paying €1,200 a month in rent. They are not married. Carol is self-employed and earns €85,000. Eoin is a civil servant and earns €37,000. Carol and Eoin will be affected by the reduction in tax credits and reduction in the married person tax band.

They will also be affected by the proposal to introduce a Universal Social Charge in 2011, which will replace Health Levy and Income Levy.



How it compares

2010

2011

Gross income

€122,000

€122,000

Pension levy

€1,950

€1,950*

Taxable income

€120,050

€120,050

Income tax (before credits)

€34,216

€35,445

Total credit

€6,290

€5,590**

PRSI

€3,688

€4,616

Universal social charge

(Income and health levies)

€7,501

€7,178

Net income

€80,935

€78,401

Total deductions

percentage of gross income

33.66%

35.74%

* The pension levy is not tax deductible for PRSI and the Universal Social Charge with effect from January 1, 2011.

** It is assumed in the above calculations that the rental credit is reduced by 20pc.

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