Brendan Burgess
Founder
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This is Ireland’s most complicated tax. I think I have it right, but I am open to correction. You can read the Department of Social Welfare's Employers Guide.
The Department has a list of Excel calculators at the bottom of this page. It has a calculator for 2009 first budget.
This post covers only Class A employees i.e. most private sector employees.
The generic name is PRSI which is comprised of
A Social Insurance Contribution and
A Health Contribution
Note: All the figures given here are for those paid weekly. For those paid monthly, different figures apply. If someone wants to reproduce this post with the monthly figures, that would be a great help.
If your salary is less than €352 in any week
You pay nothing
If your salary is between €352.01 and €500 in any week
First €127: 0% (Employee’s PRSI-Free Allowance)
Balance: 4% (4% Social Insurance)
If your salary is over €500 in any week
First €127: 4% ( Health Levy only)
Balance: 8% (4% Social Insurance + 4% Health Levy)
(If your earnings for the year are less than €26,000, you will be able to apply for a refund of any Health Levy paid. You pay the Health Levy of 4% in any week, where your earnings are over €500 - this is discussed here)
Earnings over €75,036 per annum
First €127 per week: 4% health levy
> €127.01 8% (4% Social Insurance + 4% Health Levy)
When your annual earnings exceed €75,036 the rate drops to 4% Health Levy only.
However, if your weekly earnings exceed €1,925 in any week, you pay 9% (4% PRSI + 5% Health Levy) or just the 5% Health Levy, if your income for the year to date has exceeded €75,036.
(If your weekly earnings exceed €1,443 you will pay the additional 1% Health Levy. However, at the end of the year you will be entitled to a refund, if your total salary is less than €75,036. These refunds are tiny and not worth claiming. Check out here)
Another way of looking at it just to confuse you
The PRSI contribution of 4% is payable on all income over €127 per week up to a ceiling of €75,036 annually.
The Health Levy of 4% is payable on all income up to €1,443 per week.
The Health Levy is 5% on incomes above that.
If your income is below €500 in any week, you pay no Health Levy
Clarifications and complications:
PRSI/Health Levy is calculated on the weekly or monthly pay. So if you are paid €351 one week and €1,000 the next, the €351 is exempt from PRSI as it is below €352 whereas you pay 8% on the €1,000.
PRSI/Health Levy is cumulative in the sense that if you earn over €75,036 in any year the rate is reduced to 4% (i.e. Health Levy only)
Subclass A2 who earn more than €500 per week pay 4% up to €75,036 and nothing on the balance i.e. they pay no Health Levy
( medical card holders and people getting a social welfare Widow's Widower's, Pension, One-Parent Family Payment or Deserted Wife's Benefit Or Allowance)
Weekly pay is the employee's money pay plus notional pay (if applicable).
EMPLOYERS PRSI ( No change since 2005)
10.75% on the whole salary except:
For salaries up to €356 per week( €1543 per month), the rate is 8.5% of the whole salary
The Department has a list of Excel calculators at the bottom of this page. It has a calculator for 2009 first budget.
This post covers only Class A employees i.e. most private sector employees.
The generic name is PRSI which is comprised of
A Social Insurance Contribution and
A Health Contribution
Note: All the figures given here are for those paid weekly. For those paid monthly, different figures apply. If someone wants to reproduce this post with the monthly figures, that would be a great help.
If your salary is less than €352 in any week
You pay nothing
If your salary is between €352.01 and €500 in any week
First €127: 0% (Employee’s PRSI-Free Allowance)
Balance: 4% (4% Social Insurance)
If your salary is over €500 in any week
First €127: 4% ( Health Levy only)
Balance: 8% (4% Social Insurance + 4% Health Levy)
(If your earnings for the year are less than €26,000, you will be able to apply for a refund of any Health Levy paid. You pay the Health Levy of 4% in any week, where your earnings are over €500 - this is discussed here)
Earnings over €75,036 per annum
First €127 per week: 4% health levy
> €127.01 8% (4% Social Insurance + 4% Health Levy)
When your annual earnings exceed €75,036 the rate drops to 4% Health Levy only.
However, if your weekly earnings exceed €1,925 in any week, you pay 9% (4% PRSI + 5% Health Levy) or just the 5% Health Levy, if your income for the year to date has exceeded €75,036.
(If your weekly earnings exceed €1,443 you will pay the additional 1% Health Levy. However, at the end of the year you will be entitled to a refund, if your total salary is less than €75,036. These refunds are tiny and not worth claiming. Check out here)
Another way of looking at it just to confuse you
The PRSI contribution of 4% is payable on all income over €127 per week up to a ceiling of €75,036 annually.
The Health Levy of 4% is payable on all income up to €1,443 per week.
The Health Levy is 5% on incomes above that.
If your income is below €500 in any week, you pay no Health Levy
Clarifications and complications:
PRSI/Health Levy is calculated on the weekly or monthly pay. So if you are paid €351 one week and €1,000 the next, the €351 is exempt from PRSI as it is below €352 whereas you pay 8% on the €1,000.
PRSI/Health Levy is cumulative in the sense that if you earn over €75,036 in any year the rate is reduced to 4% (i.e. Health Levy only)
Subclass A2 who earn more than €500 per week pay 4% up to €75,036 and nothing on the balance i.e. they pay no Health Levy
( medical card holders and people getting a social welfare Widow's Widower's, Pension, One-Parent Family Payment or Deserted Wife's Benefit Or Allowance)
Weekly pay is the employee's money pay plus notional pay (if applicable).
EMPLOYERS PRSI ( No change since 2005)
10.75% on the whole salary except:
For salaries up to €356 per week( €1543 per month), the rate is 8.5% of the whole salary