If you’re getting started with Payroll there are some things you need to know about, PRSI and the USC
Q: I’m becoming Self Employed. Do I have to Pay PRSI and USC
A: Yes. You will be in class S for PRSI.
If you earn €5000 or less from Self Employment, you’re exempt from PRSI. You can pay a Voluntary Contribution if you wish to keep your Social insurance contributions up to date.
PRSI is paid on your Taxable Income. Taxable Income is Gross Income, minus allowable expenses. Here’s the Revenue guide to what are allowable expenses: http://www.revenue.ie/en/business/running/allowable-expenses.html#section1
If you earn over €5000 from Self Employment, but under €12.500 you must pay €500 PRSI. Once you go over €12,500 Taxable Income, everything is charged at 4%
Paying Class S PRSI attracts limited State benefits, such as, Maternity Benefit and the State Pension.
Payroll Software such as Bullet, automatically works out your PRSI contribution and your allowable expenses.
Payroll: Universal Social Charge
As well as PRSI, you must pay the Universal Social Charge (USC) if your gross income is more than €10,036 per year. You’re exempt if it’s under that.
If you earn over €10,036 you pay 2% on the first €10,036 which is €200.72
4% on the next €5980, which is €239.20
Then it’s 7% on the rest up to €100,000.
If you’re self-employed, you must pay 10% on everything over €100,000.
I’m thinking of taking on an employee. What’s that going to cost me?
You’re obliged to deduct Employee PRSI from your employee’s wages and pay it over to the Government. On top of this, you have to pay what’s called Employers PRSI which is an additional cost to you.
If you pay someone a gross of €356 per week or less, you must pay 4.25% Employers PRSI. Once you pay them over €356 per week you pay 10.75%
Bullet Payroll Software works all this out for you automatically
Do I need really need Payroll Software? How will it make my life Easier?
- Bullet Payroll, automatically works out your PRSI and USC bill.
- Bullet Accounting software automatically works out your expenses and puts them into your payroll
- If you’re an Employer, you have to make monthly and annual returns to the Revenue. Bullet does this for you.
- Bullet works backwards! If you want to offer someone minimum take home pay, you can enter the amount into the Net Pay section and Bullet will reverse calculate the Tax Bill for you.
- If you’ve got Bullet Payroll, you won’t need an Accountant or Tax Advisor to get things done.
- If you’re out on the road, selling, Bullet’s Free iPhone App tracks your Mileage and automatically puts it into your payroll.
- There’s no software to download. It’s all done on line.
- You get all this for a low monthly fee.