PRSI/health levy thresholds

I know that the PRSI/health levy thresholds were calculated on a weekly or monthly basis. Is this still the same for 2010 ?

I ask because ,as we all know, there is that ridiculous threshold at 500 euros a week when ,if someone gets a 2% increase -25 euros -they actually get less in their hands.
A crazy siTutaion that has existed -at differing thresholds- for years.

Bluntly, if I increase someones salary from 25.000 to 30.000 it is costing me 5.000 (plus employers liability - about an extra 5.537). But the employee only gets 1800 extra.
That is, it costs me 5.537 to give someone 1.800 !!
(have I got my sums wrong -it seems too crazy ?)

Obviously it would be quite wrong of me to give the employee an official salary of 25k and bung 2k in their hands -even though it would save me 3k and the employee still gets the same as if officially paid 30k

So, is it O.K. to pay someone under the threshold each month - ca. 2.166
for eleven months? And on the twelve month -December -give them just over 6k -total 30k ?

Obviously on that 6k the employee take a hit -having passed the threshold. But on the overall year he/she loses far less than if paid 600 each week.

But would Revenue say - "the total annual salary was 30k and so in fact the average monthly salary was 600 ,thus the employee owes us the levy for each of the preceding 11 months" ??

In the very last sentence above I meant to write avrage weekly salary was 600

My understanding is that as employee's PRSI is paid on a 'week 1' basis (ie you ignore everything that happened previously) that your proposal to pay €2166 per month with a topup in month 12 ('Christmas bonus'!) is perfectly legitimate. As you note, the employee will take a hit in month 12 but it's still worth it as per the following:

On the basis of a single person with totally standard tax credits, I calculate that s/he would earn €1930 net for months 1-11 on a gross of €2166 for each month. In month 12, s/he'd gross €6174 and net €4649, giving a total net for the year of €25878.

If you were to pay him/her €2500 per month, s/he'd net c.€2077 per month or annually €24925. Therefore, s/he gains by €953 in the year by going with option 1!

I don't know the rules re employer's PRSI but am guessing that it is dealt with in much the same way as employee's PRSI.

[Check my calculator at http://taxcalc.eu/monthlyss ]

One good thing about PRSI , is that it is not cumulative ,and each week/month stands on its own .

The prsi system allows for fluctuations on a weekly basis from €38 to €352 to €500 etc .

many tks for replies. Its good to know there's a legal way to beat this threshold penalty.