AITI Chartered Tax Adviser

How are married couples taxed?

If you are a married couple, you can opt to be treated for tax purposes as follows:
(a) Single assessment. Each of you is treated as a single person, and each gets the standard tax credit for a single person. Single assessment is generally less advantageous than joint assessment because you can lose the unused part of the lower earning spouse’s standard rate band, and any unused allowances of that spouse.
(b) Joint assessment. Your joint income is combined, and you get a married couple’s standard tax credit, which is double the single person’s tax credit. Unless you elect otherwise, as a married couple you are automatically treated as jointly assessed, with the main earner entitled to the married tax credit and responsible for filing the tax return. Either of you may elect at any time in the tax year to be treated as a single person. Joint assessment means that even if the lower earning spouse does not have income taxed at the higher rate, the unused part of the lower earner’s standard rate band can be used by the higher earner. Revenue do not generally allow joint assessment if one of you is non-resident, but may do if the non-resident spouse’s income is fully chargeable to Irish tax.
(c) Separate assessment. Each of you is taxed on your own income, and each of you is responsible for filing your own tax return. Allowances are generally allocated on the basis of who incurred the expenditure. Any unused part of the lower earning spouse’s standard rate band is transferred to the higher earning spouse. In net terms, your tax liability is the same as under joint assessment.
For the purposes of PRSI and universal social charge, each of you is treated as a separate individual.