Income tax 2016

Income tax 2016

January 1st means the first sight of the changes brought in by the recent budget to your weekly/monthly wage packet, and the news for 2016 is generally good.

 

The biggest changes come in the Universal Social Charge (USC) with 0.5% reductions in the lower two bands and a 1.5% reduction in the main USC band. The new rates and bands are set out below;

1.0% rate for €0 – €12,012 (down from 1.5%)

3.0% rate for €12,013 – €18,669 (down from 3.5%, band extended from €17,576)

5.5% rate for €18,669 – €70,044 (down from 7%)

8.0% rate for income above €70,045 (no change)

11.0 % rate for all income above €100,000 if you are self employed (no change)

 

A new Earned Income Credit of €550 is being introduced for taxpayers earning self-employed trading or professional income in certain cases and to business owner/managers who are ineligible for a PAYE credit on their salary income

 

Finally it should be noted that the national minimum wage has been increased by 50 cent to €9.15. There  have been some minor changes to the PRSI system to take into account this increase

 

For more details or assistance with your payroll services give us a shout and we’ll be in touch as soon as possible.

 

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