Social insurance treatment depends on whether a person is categorized as an employee or an independent contractor. As is the case in other contexts, the distinction may be fine in some cases. Parties may seek to label themselves in a particular way, generally as self-employed so as to avoid, the employer’s obligation to pay employer’s PRSI and to withhold and remit both income tax and […]
Every person over 16 years of age and under pensionable age (66 years) in insurable employment is employed contributor. a person over 66 and under pensionable age with reckonable income or reckonable emoluments who is not employed, is a self-employed contributor. Employer and employee PRSI and universal social charge on benefits must be collected by the employer on the taxable value of the benefit. The […]
Individuals may make voluntary social insurance contributions in order to enhance retirement benefits. If a person ceases to be an employed or self employed contributor and has qualifying contributions of less than 260 weeks he is entitled to become insured by paying contributions as a voluntary contributor. This must be done within 12 months of the end of the tax year in which they last […]
Social insurance is administered by The Department of Social Protection. The employment and training levy was formerly administered by the Department of Enterprise Trade and Employment. It was abolished in 1999. The Department of Health managed the Healthy Levy. Health contributions were paid pursuant to the Health Contributions Act 1979. The Universal Social Charge replaced both in 2011 . It was intended as a significant […]
Broad Exemptions Income Threshold; Where an individual’s total income for a year does not exceed €13,000. The USC exemption threshold is €13,000 for the years 2016 to 2022, €12,012 for 2015 and €10,036 for the years 2012 to 2014. All Department of Social Protection payments Similar Type Payments Payments that are made in lieu of Department of Social Protection payments such as payments for participation in […]
Losses Losses, other than those arising from the carrying on of a trade or profession, are not deductible before USC is charged. Trading losses arising in a tax year cannot reduce other non-trading income in that year for the purposes of USC. Where unused trading losses are carried forward, only that part of the losses that is actually used to reduce taxable income from the […]
Finance Act 2011 introduced universal social charge in lieu of the income levy and health levy. The USC is broadly speaking, a flat rate tax payable on almost all income. The universal social charge was introduced as a means raising revenue quickly . It replaced a pre-existing income levy. Income levies had been introduced in the past as a short lived semi-emergency measure. Universal social […]
Collection of social insurance and levies is undertaken by the Revenue Commissioners. The social insurance system itself is administered by the Department of Social Protection. Social insurance and levy payments apply over and above tax. They apply generally to the whole of income. There are no allowances. Payment is mandatory. Collection is through PAYE for employees and though the self-assessment tax system for traders. There […]
Private/Public Sector Employments PRSI Class A People in industrial, commercial and service-type employment who are employed under a contract of service with reckonable pay of EUR38.00 or more per week from all employments; Civil and Public Servants recruited from 6 April, 1995 and Community Employment participants from 6 April, 1996. Class A Benefits Jobseeker’s Benefit Illness Benefit Maternity Benefit Adoptive Benefit Health and Safety Benefit […]
Universal social charge has been used as a mechanism for recovery of so-called excess bank remuneration and bonuses. The 45 percent rate applies to bank bonuses of certain employees of banks and financial institutions. A special rate of 45 percent applies to so-called excess bank remuneration. The provision applies to employees of institutions specified in the Credit Institutions (Financial Support) Act in receipt of State […]
PRSI and health contributions did not apply to benefits in kind prior to 2004. Income tax on benefits in kind was not collected under the PAYE system. As of 2004, benefits in kind and non-pecuniary emoluments are included in reckonable earnings and are subject to PRSI and USC PAYE must be now operated on benefits in kind in respect of income tax, employer’s and employee’s […]
A PRSI employer’s incentive scheme exempted employers from paying employers PRSI for 18 months, subject to conditions. A job must be created. The employee must have been on an industrial training or placement program for at least three months on job bridge for at least six; or have been in receipt of jobseekers allowance or benefit, single-family payment or disability allowance for at least six […]
Self-employed persons were brought within the scope of social insurance in 1988. They pay a lesser rate and receive a reduced range of benefits, relative to an employed contributor. The are entitled to the state pension, widowers and survivors pensions, maternity benefit, bereavement grant and adoptive leave benefit. They do not qualify for jobseekers benefits and illness related benefits. A self-employed contributor is a person […]
Persons between 16 and 66 years’ old, are subject to compulsory social insurance. They are referred to as being in insurable employment. The rates and categories applicable to employees, differ to that in respect of self-employed persons. The age limit, social welfare pensionable age, will eventually be increased to 68 years by [2028]. Insurable employments include service / employment in the State under a contract […]
The National Training Fund Act, 2000 provided for repeal of previous levies on employers under the Industrial Training Acts. It established a National Training Fund and provided for a new associate levy. The Fund finances a range of schemes aimed at raising the skills of those in employment and at providing training to those who wish to acquire skills for the purpose of taking up […]
The Universal Social Charge (USC) replaced both the income levy and the health levy (health contribution) since 1 January 2011. The Health levy applied to reckonable earnings, reckonable emoluments and reckonable income. Reckonable emoluments mean employment income. Reckonable earnings are income from employment. Since 2004 non-pecuniary income such as benefit, and kinds are included. Contributions to pension schemes are deducted. No expenses or allowances are […]