Taxation in the Republic of Ireland

In Ireland there is an income tax, a value added tax (VAT), and various other taxes. Employees pay pay-as-you-earn (PAYE) taxes based on their income, less certain allowances. The taxation of earnings is progressive, with little or no income tax paid by low earners and a high rate applied to middle to top earners, the top marginal rate of tax (including USC and PRSI) is 52%. However a large proportion of central government tax revenue is also derived from VAT, excise duties and other taxes on consumption. The standard rate of corporation tax is among the lowest in the world at 12.5%.

Income tax is charged in respect of all property, profits, or gains. Since 2002, Ireland has operated a tax year coinciding with the calendar year (1 January to 31 December). The change coincided with the introduction of the euro in Ireland. For administrative purposes, taxable income is expressed under four schedules:

Since 1 January 2015, the tax rates apply as follows:

There are 2 tax brackets, 20% (the standard rate) and the balance of income at 40% (the higher rate). The brackets depend upon the individual's category.

The €42,800 amount may, for married couples, be increased by the lesser of: €24,800 or the income of the second spouse. This brings the total maximum standard rate band for a married couple to €67,600, twice the single person's band. The increase is not transferable between spouses.

A taxpayer's tax liability is reduced by the amount of his tax credits, which replaced tax-free allowances in 2001. Tax credits are not refundable in the event that they exceed the amount of tax due, but may be carried forward within a year.

A wide range of tax credits is available. A few are awarded automatically, while others must be claimed by taxpayers.

The principal tax credit is the personal tax credit, which is currently €1,650 per year for a single person and €3,300 per year for a married couple. A widowed person in the year of bereavement, or for as long as she has dependent children, may claim the €3,300 credit as well; a higher credit is available to widowed parents during the five tax years following the bereavement.

...
Wikipedia