Tax Toolkit / PRSI CONTRIBUTIONS 2021
Class A Employee PRSI
- The pay/income threshold to determine whether employees pay PRSI at Class A or J remains at €38.
- Employees paid €38 to €352 inclusive in any week should be recorded under subclass AO.
- For gross earnings between €352.01 and €424, the amount of the PRSI charge at 4% is reduced by a new tapered weekly PRSI Credit.
- Employees paid €352.01 to €376 inclusive in any week should be recorded under subclass AX. The PRSI Credit applies.
- Employees paid €376.01 to €424 inclusive in any week should be recorded under subclass AL. The PRSI Credit applies.
- In any week that an employee is paid more than €424, it should be recorded under subclass A1 or A4. No PRSI Credit applies.
- Participants in Community Employment who are paid €352, or less in any week should be recorded under Subclass A8. In any week that the pay is more than €352 record under subclass A9. The PRSI Credit applies to subclass A9 for pay between €352.01 and €424.00 in a week.
- Community Employment supervisors and employees on apprenticeship schemes are insurable at Class A in the normal way.
Other Employee PRSI
- In any week that an employee is paid more than €500, it should be recorded under subclass B1, C1, H1, J1 or S1, where appropriate.
- Class B, C, D or H employees paid up to €352 inclusive in any week should be recorded under subclass BO, CO, DO or HO.
- Class B, C, D or H employees paid between €352.01 and €500 inclusive should be recorded under subclass BX, CX, DX or HX.
- Class H employees paid between €352.01 and €424 inclusive should be recorded under subclass HX.
- Class H employees paid more than €424 should be recorded under subclass H1.
- For people covered under Class J or S and paid up to €500 inclusive in any week, record under subclass O, that is, JO or SO as appropriate.
- PRSI classes B, C and D will pay PRSI at 0.9% up to €1,443 a week and 4% above €1,443 a week.
- Civil and public servants will pay PRSI on the ‘Pension Levy’ portion of their salaries.
- Civil and public service employers do not have to pay any employer PRSI on the ‘Pension levy’.
PRSI for the self-employed
- Self-employed people, other than self-employed company directors, must register with the Revenue Commissioners for PRSI purposes. Under the self assessment system, PRSI is paid to the local tax office together with any other payment due. Self-employed company directors pay their PRSI under the PAYE system.
Minimum/Flat rate Self-employed Payments
- Self-employed contributors with annual self-employed income over €5,000 pay Class S PRSI at the rate of 4%, subject to a minimum payment of €500.
- Those with an annual self-employed income in excess of €5,000 who have been told by an Inspector of Taxes that they need not make a return of income must pay a flat rate PRSI contribution of €310 to this Department.
- The flat rate of payment of Voluntary Contributions made by former self-employed contributors is €500.
- Telephone: (074) 9364509
- LoCall: 1890 690 690
- If you are calling from outside the Republic of Ireland please call +353 74 936 4503 .Note: The rates charged for using 1890 (LoCall) numbers may vary among different service providers.
- If a person is no longer liable to pay PRSI, they may apply to become a voluntary contributor.
- For more information, log on to www.welfare.ie.
- The Class J contribution normally relates to people paid less than €38 per week (from all employments). However, a small number of employees are insurable at Class J no matter how much they are paid, such as employees aged 66 or over and people in subsidiary employment.
Components of the PRSI contribution
- The Pay Related Social Insurance (PRSI) contribution is made up of a number of different components including:
- social insurance at the appropriate percentage rate for employees and employers, which varies according to the pay and PRSI Class of the employee and benefits for which he or she is insured.
- the 0.80% National Training Fund Levy, included in the employer’s contribution in Classes A and H.
Levels of payment
- PRSI contributions will be payable as follows:
- at the appropriate percentage rates for employees on all reckonable earnings.
- on all reckonable pay, the employer’s share (social insurance and the 0.80% National Training Fund Levy in classes A and H) is due.
- Class S, social insurance at 4.00% on all reckonable income.
- The National Training Fund Levy is included in the contribution rates outlined on pages 4 to 7 where applicable.
- PRSI is calculated on the employee’s reckonable pay. Reckonable pay is the gross money pay plus notional pay (or benefit in kind) if applicable.
- The net value of share-based remuneration is to be treated as notional pay.
- The net value of share-based remuneration is to be treated as notional pay for the purposes of calculating employee PRSI only.
- Employee PRSI only is payable on share-based remuneration. There is no employer PRSI chargeable on gains from share-based remuneration.
- The obligation to deduct and remit PRSI in respect of share-based remuneration generally rests with the employer.
- Accordingly the PRSI payable should be deducted by the employer through payroll along with other PRSI liabilities and remitted to the Collector-General with the monthly P30 return.
- Different arrangements may apply in the case of PRSI on gains from the exercise of certain share options.
- More detailed information on the treatment of share-based remuneration for PRSI purposes is contained at: www.welfare.ie (Revenue - Irish Tax & Customs).
- PRSI is fully chargeable on payments by employees in respect of:
- Superannuation contributions
- Permanent health benefit schemes (including income continuance schemes)
- Revenue approved schemes established under irrevocable trusts, overseas pension schemes and other
- Revenue exempt approved schemes
- Personal Retirement Savings Accounts
- Revenue approved retirement funds
- Civil and Public Service employers do not pay employer PRSI on the pension levy paid by their employees. Employee PRSI is chargeable.
PRSI contribution weeks
- A contribution week is each successive period of seven days starting on 1 January each year. Week 1 is the period from 1 to 7 January inclusive, week 2 from 8 to 14 January and so on. For 2018, the contribution week starts on a Monday and ends on a Sunday. A contribution at the appropriate class should be awarded to an employee for each contribution week or part of one, for which he or she is in insurable employment.
- Voluntary contributions
- People who were insured at Classes A, B, C, D, H or S and who are no longer insurably employed may opt to pay Voluntary Contributions to provide cover for pensions.
- Applications must be made within 60 months from the end of the PRSI contribution year in which a PRSI contribution was last paid or credited. For more information, log on to www.welfare.ie