2017 Budget - Employer Summary

Budget 2017 – Employer Payroll Focus

PAYE

Tax Rates and Standard Rate Cut Off Points (SRCOPs)

There has been no change to tax rates or SRCOPs. The standard rate of tax will remain at 20% and the higher rate of tax will remain at 40%.

There has been no change to the SRCOP and Tax Credits on the Emergency Basis of tax.

Universal Social Charge (USC)

• No change to the USC exemption threshold of €13,000
• The 1%, 3% and 5.5% rates have been reduced by 0.5% to 0.5%, 2.5% and 5% respectively
• There has been no change to the 8% rate of USC
• The Rate 2 COP has been increased from €18,668 to €18,772

Medical card holders and individuals aged 70 years and over whose aggregate income does not exceed €60,000 will pay a maximum rate of 2.5%.

The rate of 8% USC will continue to apply under the Emergency Basis.

PRSI

There were no changes, the PRSI Credit introduced in Budget 2016 remains.

Minimum Wage

The National Minimum Wage will increase from €9.15 gross per working hour to €9.25 gross per working hour.

• Workers under age 18 will be entitled to €6.48 (currently €6.41) per working hour.
• Workers in the first year of employment over the age of 18 will be entitled to €7.40 (currently €7.32) per working hour. 
• Workers in the second year of employment over the age of 18 will be entitled to €8.33 (currently €8.24) per working hour.

Minimum wage for trainees:

Employee aged over 18, in structured training during working hours:

• 1st one third of course will increase to €6.94 (currently €6.86),

• 2nd third of course will increase to €7.40 (currently €7.32) 3rd part of course €8.33 (currently €8.24).

Pension Related Deduction (PRD)

Budget 2017 did not make any change to the rates and thresholds for PRD.

However, the Financial Emergency Measures in the Public Interest Bill 2015 provides for the following changes:

• From 1st January 2017, the exemption threshold will increase from €26,083 to €28,750. 10% PRD will apply to earnings between €28,750 and €60,000, and 10.5% PRD will apply to any earnings in excess of €60,000.