Neptuno

To the tax experts
How much income tax would someone pay on an annual income of €17.5 k, made up of state and occupational pensions and some savings interest?

Fred James

Depending on the split between savings income (which is taxed at a lower rate) and assuming you are over 65, the worse case is €2172 a year tax.

If the occupational pension was in the form of a money purchase annuity then the tax could be less.

Neptuno

Thanks for the advice

Rosemary

If you have a mortgage this is taken into account and you pay less tax.

Rosemary

scrubbedexpat095

Actually I'm not sure this is true now

I think the PP changed it after their first year in power but I'm sure someone who has a mortgage will be along to confirm or deny

Fred James

Tax relief on new mortgages was abolished from January 1st 2013.

Existing mortgages continue to get relief. The relief is very generous as you can claim both interest and capital repayments up to a maximum of €9040 in the tax year and the relief is 15% making a maximum deduction from your tax bill of €1356.

Rosemary

I wanted to pay off my mortgage when my husband died but my gestor advised me not to due to the tax relief that I recieve. I talked to him yesterday about the tax due and he again encouraged me to keep the mortgage as it helps.

Rosemary

billgates

So if you rent your house privately then you get no tax relief, but if you rent from the bank (a mortgage in other words) then you do get tax relief.

Is that about the sum of it?

Fred James

No, you can claim tax relief if you rent a property.

You can claim 10.05% of the rental costs subject to a maximum of €9040 (ie €908) if your taxable income is less than €17707.

If it is between €17707 and €24107 the maximum is on a sliding scale and if your income is more than €24107 you get nothing.

It only applies if the house you are renting is your habitual residence.

Unfortunately, not a lot of people know this!