Q My wife and I had our second child last September and she still has two months of maternity leave. She is reluctant to go back to work and we are working out our finances to see if we can manage financially if she decides not to. We both have a good income, are in the higher tax bracket and are assessed together. Would we be better off or worse off from a tax perspective if she quit her job?
A In general, when one spouse earns above the standard rate limit (SRCOP – the amount of income you can earn before you switch to the 40 percent income tax rate) and the other takes care of the children at home and is taxed there together, according to the director by Taxback.com, Barry Cahill, Significant tax savings are possible.
When filing jointly, a married couple is entitled to a higher standard tax rate (ie you can earn more money than a single person before reaching the higher income tax rate) and you are entitled to the personal tax credits for married couples.
Currently, if only one spouse works, a couple with the increased standard-rate tax margin can earn up to €45,800 before being charged the higher income tax rate, Mr Cahill said.
If a spouse stays at home to look after a child for whom you or your spouse are receiving child benefit from the Ministry of Social Affairs, you may also be able to claim the home care tax credit of €1,600 due to joint assessment.
Q Is it true that VHI Healthcare has now discontinued the Health Plus Premium plan? My health insurance is very important to me and I’ve had it for a very long time. So what are my options?
A As of May 1st, this VHI health plan is no longer available for renewal. This is because the insurer has reduced the total number of plans it offers to make it easier to choose plans.
VHI According to TotalHealthCover.ie’s Dermot Goode, Healthcare is writing to all members offering them the option of upgrading to the Premium Care program, which is the next plan and is a coverage upgrade. This new plan cost €4,597 per adult, but was reduced to €4,000 per adult from May. Mr Goode said it was his understanding that VHI Healthcare was offering these members a 5 percentage point discount to upgrade to the new plan, bringing the cost down to around €3,790.
This is slightly below the previous cost of Health Plus Premium (€3,861 before discontinuation). In summary, the new plan offered is better than the previous plan and is offered at a special discount for at least next year, Mr. Goode said.
Q I just spent €3,400 on a new set of patio furniture, a fire pit and a grill. There is a lot of money to spend, but we can make good use of our garden. Is this covered by the contents of my home insurance or do I need to buy supplemental insurance or even a separate policy to cover this?
A Standard household insurance policies that include buildings and contents insurance usually also cover your patio furniture or outbuildings such as sheds or garages. This means they offer coverage for home garden tools, according to People Insurance chief executive Paul Walsh. However, there are a number of exclusions when it comes to content, and particularly items kept in your garden, he said.
Some insurers cover items such as garden furniture up to a certain amount, usually between €650 and €1,500 in a claim relating to the garden contents.
Mr Walsh said that in your case your coverage would only extend to about 20 to 40 per cent of the cost of your suite if it were stolen and for some causes of damage. Since most garden furniture is stored outdoors, it should be borne in mind that damage caused by frost or weather-related wear and tear is generally excluded in most policies.
Many insurers allow you to add an additional payment to your coverage, which would protect you from accidental damage. It’s worth checking before paying though, as most outdoor furniture covers are capped at around £3,000 – which is something to consider with a fire pit – or even theft.
It’s worth remembering that some insurers may require you to securely store or cover expensive items like a grill, the head of personal insurance said.
https://www.independent.ie/business/personal-finance/your-personal-finance-questions-does-it-make-sense-from-a-tax-point-of-view-for-my-wife-to-give-up-work-41788048.html Your personal financial questions – Does it make sense from a tax perspective for my wife to give up gainful employment?