Ireland Payroll Module
Overview
The Ireland Payroll Module provides end-to-end payroll processing for Irish employees, fully compliant with Revenue Commissioners requirements. It handles PAYE income tax, USC (Universal Social Charge), PRSI (Pay Related Social Insurance), pensions, and Revenue Online Service (ROS) submissions.
- Tax Year: January -- December (calendar year)
- Currency: Euro (EUR / €)
- Regulatory Authority: Revenue Commissioners
- Online Filing: Revenue Online Service (ROS)
Tax System -- PAYE (Pay As You Earn)
PAYE is the primary income tax system. Tax is calculated on gross pay using a two-rate structure and offset by tax credits.
Tax Rates
| Band | Rate | Description |
|---|---|---|
| Standard Rate | 20% | Applied to income up to the Standard Rate Cut-Off Point (SRCOP) |
| Higher Rate | 40% | Applied to income above the SRCOP |
Standard Rate Cut-Off Point (SRCOP)
The SRCOP determines how much income is taxed at 20% before the 40% rate applies. It varies by marital/civil status.
| Status | 2025 | 2026 |
|---|---|---|
| Single person | €44,000 | €44,000 |
| Married couple (one income) | €53,000 | €53,000 |
| Married couple (two incomes) | €88,000 | €88,000 |
Note: For married couples with two incomes, the maximum transferable amount between spouses is €31,000.
Tax Credits
Annual tax credits are deducted from calculated gross tax to arrive at the net PAYE liability. Common credits include:
| Credit | Annual Amount |
|---|---|
| Single Person | €2,000 |
| Married Person | €4,000 |
| Employee (PAYE) Tax Credit | €2,000 |
| Earned Income Credit (self-employed) | €2,000 |
| Widowed Person | €2,000 |
| Single Person Child Carer | €1,900 |
| Home Carer | €1,950 |
| Age Credit (single) | €245 |
| Age Credit (married) | €490 |
| Blind Person (single) | €1,650 |
| Blind Person (married) | €3,300 |
Revenue Payroll Notification (RPN)
The RPN is issued by Revenue and contains the employee's tax credits, SRCOP, and tax basis. It is the authoritative source for calculating PAYE deductions.
- Import: RPNs can be retrieved from Revenue and applied to employee records.
- Employee fields populated: tax credit, standard rate cut-off, tax basis, RPN number and RPN date.
Tax Basis
| Basis | Description |
|---|---|
| Cumulative | Default. Tax is calculated on year-to-date income, with previous period credits and thresholds accumulated. Refunds are possible if earlier periods were overtaxed. |
| Week 1 / Month 1 | Each pay period is treated independently. No year-to-date accumulation. No refunds mid-year. Used when directed by Revenue via the RPN. |
Emergency Tax
Applied when no RPN is available for an employee (e.g., new starter without a PPS number registered with Revenue).
| Pay Cycle | Standard Rate Periods | Then |
|---|---|---|
| Weekly | First 4 weeks at 20% | Week 5 onwards at 40% |
| 2-weekly | First 2 fortnights at 20% | Fortnight 3 onwards at 40% |
| 4-weekly | First period at 20% | Period 2 onwards at 40% |
| Monthly | First month at 20% | Month 2 onwards at 40% |
Worked Example -- Monthly PAYE
An employee earns €55,000 annually (€4,583.33/month), is single, and has the default credits and SRCOP.
- Monthly SRCOP: €44,000 / 12 = €3,666.67
- Tax at 20%: €3,666.67 x 20% = €733.33
- Tax at 40%: (€4,583.33 - €3,666.67) x 40% = €366.67
- Gross tax: €733.33 + €366.67 = €1,100.00
- Monthly tax credits: (€2,000 + €2,000) / 12 = €333.33
- Net PAYE: €1,100.00 - €333.33 = €766.67
USC (Universal Social Charge)
USC is a tax on gross income, charged progressively across bands.
Standard USC Bands (2025)
| Band | Income Range | Rate |
|---|---|---|
| 1 | First €12,012 | 0.5% |
| 2 | €12,012 -- €27,382 | 2% |
| 3 | €27,382 -- €70,044 | 4% |
| 4 | Above €70,044 | 8% |
Standard USC Bands (2026 -- Budget 2026 Changes)
| Band | Income Range | Rate | Change |
|---|---|---|---|
| 1 | First €12,012 | 0.5% | -- |
| 2 | €12,012 -- €28,700 | 2% | Ceiling raised from €27,382 |
| 3 | €28,700 -- €70,044 | 3% | Reduced from 4% |
| 4 | Above €70,044 | 8% | -- |
Exemptions
- Full exemption: No USC is payable if the employee's total annual income is €13,000 or less.
- Once income exceeds €13,000, USC applies to the full amount from the first euro.
Reduced Rates
Reduced USC bands apply to:
- Medical card holders with annual income at or below €60,000
- Individuals aged 70 or over with annual income at or below €60,000
| Band | Income Range | Rate |
|---|---|---|
| 1 | First €12,012 | 0.5% |
| 2 | Above €12,012 | 2% |
Self-Employed Surcharge
Self-employed individuals with non-PAYE income above €100,000 pay an additional 3% USC surcharge on income above that threshold (effective rate of 11% on that portion: 8% standard + 3% surcharge).
Employee USC Status Field
| Value | Description |
|---|---|
| Standard | Standard USC bands apply |
| Reduced | Reduced bands (medical card / over 70) |
| Self-employed | Standard bands plus 3% surcharge |
Worked Example -- Monthly USC (2026)
Employee earning €55,000 annually (€4,583.33/month). Standard status.
Monthly USC calculation (annual bands divided by 12):
| Band | Monthly Range | Taxable | Rate | USC |
|---|---|---|---|---|
| 1 | €0 -- €1,001 | €1,001.00 | 0.5% | €5.01 |
| 2 | €1,001 -- €2,391.67 | €1,390.67 | 2% | €27.81 |
| 3 | €2,391.67 -- €4,583.33 | €2,191.66 | 3% | €65.75 |
| Total | €98.57 |
PRSI (Pay Related Social Insurance)
PRSI provides social insurance coverage for employees and is paid by both the employee and employer.
PRSI Classes
| Class | Description | Employee Rate | Employer Rate |
|---|---|---|---|
| A | Standard employees | 4% (2025) / 4.2% (2026 Jan-Sep) / 4.35% (2026 Oct+) | 11.15% (2025) / 11.15% (2026 Jan-Sep) / 11.40% (2026 Oct+) |
| A1 | Employees with occupational pension | Same as A | Same as A |
| B | Civil servants (pre-April 1995) | 0.9% | 2.01% |
| C | Army officers and certain officers | 1.85% | 2.01% |
| D | Full-rate public servants (Garda, teachers) | 0.9% | 2.01% |
| H | Army NCOs and privates | 0.9% | 2.01% |
| J | Over 66 or subsidiary employment | 0% | 0.5% |
| K | Proprietary directors / certain pensioners | 4% | 0% |
| M | No PRSI payable | 0% | 0% |
| S | Self-employed | 4% | 0% |
Class A Thresholds (2025)
| Threshold | Weekly Amount | Description |
|---|---|---|
| Employee threshold | €352 | No employee PRSI if weekly earnings below this |
| Employee entry point | €424 | Full employee rate above this; tapered between €352 and €424 |
| Employer threshold | €496 | Employer pays reduced rate (8.8%) if weekly earnings below this |
Class A Thresholds (2026)
| Period | Employee Threshold | Employee Entry Point | Employer Threshold | Employer Reduced Rate |
|---|---|---|---|---|
| Jan -- Sep | €352 | €424 | €441 | 9.15% |
| Oct -- Dec | €352 | €424 | €552 | 9.15% |
PRSI Credit
For Class A employees earning between €352.01 and €424 per week, a PRSI credit applies. This tapers the employee PRSI contribution to avoid a "cliff edge" where moving above the threshold would result in a disproportionate charge.
Class S -- Self-Employed
- Rate: 4% of all income
- Weekly threshold: €100 (no PRSI below €5,200 annually)
- Minimum annual contribution: €500
Statutory Contributions Summary (2026)
| Deduction | Employee | Employer | Notes |
|---|---|---|---|
| PAYE | 20% / 40% | -- | After SRCOP and tax credits |
| USC Band 1 | 0.5% | -- | First €12,012 |
| USC Band 2 | 2% | -- | €12,012 -- €28,700 |
| USC Band 3 | 3% | -- | €28,700 -- €70,044 |
| USC Band 4 | 8% | -- | Above €70,044 |
| PRSI (Class A, Jan-Sep) | 4.2% | 11.15% | Subject to thresholds |
| PRSI (Class A, Oct+) | 4.35% | 11.40% | Subject to thresholds |
| Pension | Varies | Varies | Age-based tax relief; AERSS from 2026 |
Employee Setup
Navigate to Payroll > Employees to add or edit Ireland-based employees.
Required Fields
| Field | Description |
|---|---|
| PPS Number | Personal Public Service Number -- unique Irish tax identifier |
| PRSI Class | PRSI contribution class (A, A1, B, C, D, H, J, K, M, S) |
Optional Fields
| Field | Description |
|---|---|
| USC Status | Standard, Reduced or Self-employed |
| Annual Tax Credit | From RPN -- annual tax credits allocated |
| SRCOP | From RPN -- annual standard rate cut-off point |
| Emergency Tax | Apply emergency tax basis (no RPN available) |
| Tax Basis | Cumulative or Week 1/Month 1 |
| RPN Number | Revenue Payroll Notification reference |
| RPN Date | Date the RPN was issued |
| LPT Deduction | Local Property Tax deduction amount (from Revenue) |
RPN Import
- Navigate to Payroll > Settings > Revenue.
- Use the RPN lookup feature to retrieve the latest RPN for each employee from Revenue.
- ABBPay updates the tax credit, standard rate cut-off, tax basis, RPN number and RPN date automatically.
Payrun Process
Navigate to Payroll > Pay Runs > New to create a payrun.
Steps
- Select Pay Period -- Choose the pay cycle (weekly, 2-weekly, 4-weekly, or monthly) and the period number.
- Select Employees -- Include all or specific employees in the payrun.
- Enter Earnings -- Input or confirm gross pay, allowances, overtime, bonuses, and other pay elements.
- Calculate -- The system runs all calculations:
- PAYE income tax
- USC
- PRSI employee and employer contributions
- Pension deductions
- Net pay = Gross pay - PAYE - USC - Employee PRSI - Pension - other deductions
- Review -- Examine the calculated payslips for each employee.
- Approve -- Finalise the payrun.
- Submit to Revenue -- Generate and submit the PSR (Payroll Submission Request).
Calculation Flow
Payrun Calculation
|
|-- PAYE income tax
|-- USC
|-- PRSI (employee and employer)
|-- Pension deductions
|
--> Net Pay = Gross - PAYE - USC - Employee PRSI - Pension - Other Deductions
Revenue Integration
Navigate to Payroll > Settings > Revenue to configure Revenue Online Service (ROS) integration.
ROS Setup
Connect your Revenue account to enable electronic submissions and RPN retrieval.
Submission Types
| Submission | Purpose | Frequency |
|---|---|---|
| PSR (Payroll Submission Request) | Report payroll details to Revenue | Each pay period |
| P45 | Employee leaving certificate | On cessation of employment |
| P60 / Employment Detail Summary | Annual summary per employee | Year-end (replaced by Employment Detail Summary from 2019) |
| P35 | Employer annual return | Year-end |
PSR (Payroll Submission Request)
The PSR is submitted to Revenue each time a payrun is processed. It contains per-employee details:
| Field | Description |
|---|---|
| PPS Number | Employee's Personal Public Service Number |
| Employee Name | Full name |
| Employment ID | Unique employment identifier |
| Gross Pay | Total gross pay for the period |
| PAYE | Income tax deducted |
| USC | Universal Social Charge deducted |
| PRSI Class | Employee's PRSI class |
| Employee PRSI | Employee's PRSI contribution |
| Employer PRSI | Employer's PRSI contribution |
| Pension (Employee) | Employee pension contribution |
| Pension (Employer) | Employer pension contribution |
| LPT | Local Property Tax deducted |
| Net Pay | Net pay for the period |
The system generates a CSV export for download and direct ROS submission.
P45 -- Cessation
When an employee leaves, a P45 is generated containing:
- Employment details and PPS number
- Date of cessation
- Year-to-date earnings and deductions
- Final tax credit and SRCOP details
Employment Detail Summary (formerly P60)
Since 2019, the P60 has been replaced by the Employment Detail Summary, available to employees through Revenue's myAccount. The system generates the data required for Revenue's records.
P35 -- Annual Return
The P35 is the annual employer summary submitted to Revenue, containing aggregate payroll data for all employees for the tax year.
Pension
Navigate to Payroll > Pensions to manage employee pension arrangements.
Occupational Pension Schemes
Employers can operate occupational pension schemes with employee and employer contributions. Employee contributions are deducted pre-tax, reducing the taxable income for PAYE purposes.
Tax Relief on Pension Contributions
Tax relief on employee pension contributions is age-based, calculated as a percentage of net relevant earnings up to the earnings cap.
| Age | Maximum Relief (% of earnings) |
|---|---|
| Under 30 | 15% |
| 30 -- 39 | 20% |
| 40 -- 49 | 25% |
| 50 -- 54 | 30% |
| 55 -- 59 | 35% |
| 60 and over | 40% |
Maximum earnings cap for tax relief: €115,000
PRSA (Personal Retirement Savings Account)
PRSAs are portable personal pension plans. Employer contributions to PRSAs are treated as a Benefit-in-Kind unless paid to a standard PRSA.
AERSS -- Auto-Enrolment Retirement Savings System (from 2026)
The Automatic Enrolment Retirement Savings System is Ireland's auto-enrolment pension scheme, active from 30 September 2025.
Eligibility:
- Age 23 to 60
- Earning at least €20,000 annually
- Minimum 6 months of service
Contribution Schedule (tiered over 10 years):
| Years | Employee | Employer | State |
|---|---|---|---|
| 1 -- 3 | 1.5% | 1.5% | 0.5% |
| 4 -- 6 | 3% | 3% | 1% |
| 7 -- 9 | 4.5% | 4.5% | 1.5% |
| 10+ | 6% | 6% | 2% |
Tax Year Configuration
Navigate to Payroll > Settings > Tax Year Config to view and customise tax rates.
How It Works
ABBPay uses the standard national rates by default. You can customise your company's rates if needed (for example, after a mid-year budget change).
Configuration Sections
The Tax Year Config page has four tabs:
| Tab | Contents |
|---|---|
| PAYE | Standard rate, higher rate, SRCOP by status, tax credits, emergency tax rules |
| USC | Band thresholds and rates (standard and reduced), exemption threshold, self-employed surcharge |
| PRSI | Class definitions, employee/employer rates, thresholds, reduced rates |
| Pension | Tax relief age bands, earnings cap, AERSS auto-enrolment settings |
Managing Configuration
- Year Selector: Choose the tax year to view or edit.
- Copy from Year: Copy rates from a previous year as a starting point.
- Reset to Defaults: Revert to the standard national rates.
- Rates you change are marked as manual so you can tell them apart from the defaults.
P35 Annual Return
The P35 summarises the employer's total PAYE, USC, PRSI, and LPT for the year. It is generated by ABBPay and submitted electronically through ROS.
Reports
The following reports are available for Ireland payroll:
| Report | Description | Frequency |
|---|---|---|
| Employer Cost Analysis | Total cost per employee including employer PRSI and pension contributions | Per period / annual |
| Statutory Deductions Report | Breakdown of PAYE, USC, PRSI, and pension deductions per employee | Per period / annual |
| P30 Return | Monthly or quarterly PAYE/PRSI/USC/LPT remittance summary for Revenue | Monthly / quarterly |
| P35 Annual Summary | Year-end aggregate of all payroll data per employee | Annual |
| Payslips | Individual employee payslips with full deduction breakdown | Per period |
P30 Monthly/Quarterly Return
The P30 reports the total PAYE, PRSI, USC, and LPT deducted during the period. This determines the amount to be remitted to Revenue.
| Component | Description |
|---|---|
| Total PAYE | Sum of all employee PAYE deductions |
| Total PRSI | Sum of employee and employer PRSI contributions |
| Total USC | Sum of all employee USC deductions |
| Total LPT | Sum of all LPT deductions at source |
| Amount Due | Total to remit to Revenue |
Settings
Navigate to Payroll > Settings to access the Ireland payroll settings page.
Settings Tabs
| Tab | Description |
|---|---|
| Company | Company details and payroll registration |
| Payroll | General payroll configuration |
| Tax Year Config | PAYE, USC, PRSI, and Pension rate configuration |
| Payday | Pay schedule and payment dates |
| Allowance | Allowance types (overtime, bonuses, etc.) |
| Deductions | Additional deduction types |
| Payslip | Payslip template and display options |
| Automated Salary | Automated salary processing settings |
| WhatsApp payslip delivery configuration | |
| Revenue | Revenue Online Service (ROS) connection and settings |
| Journal | Accounting journal integration settings |
| GDPR | Data protection and retention policies |
| Employment Verification | Employment verification letter settings |
Revenue Settings
Configure the connection to Revenue Online Service:
- ROS digital certificate setup
- Employer registration number
- PSR submission preferences
- RPN auto-retrieval schedule
Pay Cycles
Ireland payroll supports the following pay cycles:
| Pay Cycle | Periods per Year |
|---|---|
| Weekly | 52 |
| 2-weekly (fortnightly) | 26 |
| 4-weekly | 13 |
| Monthly | 12 |
The default pay cycle is monthly. All annual thresholds and credits are automatically divided by the number of periods for per-period calculations.
Budget 2026 Changes Summary
The following changes are confirmed for the 2026 tax year:
| Item | 2025 | 2026 | Impact |
|---|---|---|---|
| USC Band 2 ceiling | €27,382 | €28,700 | More income taxed at 2% instead of higher rate |
| USC Band 3 rate | 4% | 3% | 1 percentage point reduction |
| PRSI Class A employee rate | 4% | 4.2% (Jan-Sep), 4.35% (Oct+) | Split-year increase |
| PRSI Class A employer rate | 11.15% | 11.15% (Jan-Sep), 11.40% (Oct+) | Split-year increase |
| PRSI employer threshold | €496/wk | €441/wk (Jan-Sep), €552/wk (Oct+) | Split-year threshold |
| AERSS auto-enrolment | Not active | Active | New pension auto-enrolment |
| SRCOP (single) | €44,000 | €44,000 | Unchanged |
| Pension earnings cap | €115,000 | €115,000 | Unchanged |
Note: The 2026 PRSI Class A rates are split between January--September and October--December. The system automatically applies the correct rates based on the pay period date.