Thomas Kane Tax Advisory Services

What is this funny new charge on my payslip?

The Universal Social Charge (USC) was introduced in December 2010’s budget and is effective from 1st January 2011. It was described as replacing the income levy (itself only introduced in 2009) and the health levy, and even its name characterises it as an all-encompassing charge. However, there are a number of significant differences between the USC and both the income levy and the health levy, particularly for the lower paid.

The income levy did not apply to any person earning less than €15,028 per year, €1,252 per month or €289 per week.

The health levy did not apply to any person earning less than €500 per week. This is the equivalent of €26,000 per year.

The new USC will now apply to anyone earning above €4,004 per year, €334 per month or €77 per week. Effectively, the USC applies to the vast , vast majority of earners in the country. And the rates are as follows:

  • The first €10,036 per year is at 2%.
  • From €10,036.01 to €16,016 is at 4%.
  • The remainder is at 7%.

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Thomas Kane Tax Advisory Services