Skip to content

Do you understand payroll in Ireland?

Ireland's business landscape is thriving, and with the growth of businesses comes the need to understand the complexities of payroll management. In this blog post, we'll explore three essential aspects of payroll in Ireland: the basic payroll tax obligations, the Pay As You Earn (PAYE) system registration, and social insurance contributions.

1. What Are the Basic Payroll Tax Obligations in Ireland?

Income Tax

In Ireland, employers are responsible for deducting income tax from employees' wages under the PAYE system. The amount of tax depends on the employee's income, tax credits, and standard rate cut-off point.

Universal Social Charge (USC)

The USC is a tax on income that applies to everyone who earns more than a certain threshold. Employers must calculate and deduct this charge based on specific rates and thresholds.

Pay Related Social Insurance (PRSI)

PRSI contributions are made by both employers and employees to fund various social welfare benefits. The rate depends on the employee's earnings and class of PRSI.

2. How Do I Register for Pay As You Earn (PAYE) System in Ireland?

Registering for the PAYE system is a crucial step for employers in Ireland. Here's how to do it:

  1. Obtain a Tax Registration Number (TRN): Apply for a TRN if you don't have one.
  2. Register as an Employer: Use Revenue's Online Service (ROS) to register as an employer.
  3. Set Up PAYE Modernization: Ensure that your payroll software is compatible with Revenue's real-time reporting requirements.

3. What Are the Social Insurance Contributions for Employers and Employees in Ireland?

Social insurance contributions in Ireland are known as Pay Related Social Insurance (PRSI). They fund various social welfare benefits, including pensions, illness benefits, and unemployment support.

  • Employer's Contribution: Employers pay a percentage of each employee's earnings.
  • Employee's Contribution: Deducted from the employee's gross pay, based on their PRSI class.


Understanding payroll in Ireland can be complex, but with the right knowledge and tools, it becomes manageable. By familiarising yourself with the basic tax obligations, registering for the PAYE system, and understanding social insurance contributions, you can ensure compliance and smooth payroll processing.

If you need assistance with payroll management in Ireland or have any questions about the topics covered in this post, feel free to contact Yvonne, / Valerie, or call our office. We would be happy to help. 

Contact us