Class A employment
pay threshold to determine whether employees pay PRSI at Class A or J remains at
- Employees paid €38 to €352 inclusive in any week should be recorded under subclass AO.
- Employees paid €352.01 to €356 inclusive in any week should be recorded under subclass AX.
- Employees paid €356.01 to €500 inclusive in any week should be recorded under subclass AL.
- In any week that the employee is paid more than €500, it should be recorded under subclass A1 or A2 (
see note below)
- Participants in Community Employment who are paid €352, or less in any week should be recorded under Subclass A8. In any week that the pay is more than €352 record under subclass A9.
- Community Employment supervisors and employees on apprenticeship schemes are insurable at Class A in the normal way.
- The annual pay ceiling for PRSI remains at €75,036 for employees.
Class J employment
- The Class J contribution normally relates to people paid less than €38 per week (from all employments). However, a small number of employees are insurable at Class J
no matter how much they are paid, such as employees aged 66 or over and people in subsidiary employment (defined in Section 13).
- Class B, C, D or H employees paid up to €352 inclusive in any week should be recorded under subclass BO, CO, DO or HO.
- Class B, C, D or H employees paid between €352.01 and €500 inclusive should be recorded under subclass BX, CX, DX or HX.
- For people covered under Class J, S or K, and paid up to €500 inclusive in any week, record under subclass O, that is, JO, SO or Class M (for people within Class K) as appropriate.
- Employees or self-employed people (
excluding those listed in the note below) with pay or income of more than €500 in any week should be recorded under subclass 1 (i.e. B1, C1, D1, H1, J1, S1 or K1).
- Employees or self-employed people with pay or income more than €500 in any week, who do not have to pay the Health Contribution (
see note below) should be recorded under subclass B2, C2, D2, H2, J2, S2 or Class M (for people within Class K).
- The Class S minimum annual contribution for year 2010 remains at €253.
- Medical card holders, people aged 70 years and over, recipients of a Widow's or Widower's Pension from the Department of Social and Family Affairs, a One-Parent Family Payment, a Deserted Wife's Benefit/Allowance and recipients of a Widow's or Widower's Pension acquired under the social security legislation of a country covered by EC Regulations do not have to pay the Health Contribution - even if their pay is more than €500 a week.
It is the employer's responsibility to establish if employees fall into any of the above categories.
Components of the PRSI contribution
The Pay Related Social Insurance (PRSI) contribution is made up of a number of different components including:
- social insurance at the appropriate percentage rate for employees and employers, which varies according to the pay and PRSI Class of the employee and benefits for which he or she is insured.
- the Health Contribution, paid by the employee where applicable, goes towards funding the Health Service.
- the 0.70% National Training Fund Levy, included in the employer's contribution in Classes A and H.
Levels of payment
PRSI contributions will be payable as follows:
- they will be paid at the appropriate percentage rates for employees with reckonable earnings up to €75,036.
- on reckonable pay of more than €75,036, the employer's share (social insurance and the 0.70% National Training Fund Levy in Classes A and H) is due and the Health Contribution by the employee where applicable.
- Class S, social insurance at 3.00%
and the Health Contribution (where applicable) on
all reckonable income.
The Health Contribution and National Training Fund Levy are included in the contribution rates outlined in the sections regarding Classes.
PRSI is calculated on the employee's reckonable pay. Reckonable pay is the gross money pay
plus notional pay (or benefit in kind) if applicable, reduced by superannuation and permanent health insurance contributions made by an employee, deducted under a net pay arrangement by the employer, which are allowable for income tax purposes.
The employee's portion of the Social Insurance Contribution is paid on the employee's reckonable pay to a ceiling of €75,036. The employer's portion is payable on all reckonable pay of each employee.
PRSI-Free Allowance for employees
The PRSI-Free Allowance remains at €127 per week (per individual employment) for employees with weekly reckonable pay of more than €352 in Classes A and H, and at €26 for all employees in Classes B, C and D. The allowance does not apply to the Health Contribution or the employer's share of PRSI. In other words, in Class A it applies to the calculation of the 4% employee Social Insurance deduction, but not to the Health Contribution. The allowance is non-cumulative, so it only applies for weeks of insurable employment in which PRSI is payable (see "holiday pay" on page 12).
Remember that this allowance does not alter the gross reckonable weekly pay threshold that determines the appropriate contribution subclass.
It is important to note that the method of calculating PRSI outlined on pages 2 to 6 caters for the inclusion of the €127/€26 PRSI-Free Allowance.
For employees paid other than weekly, alternatives to the weekly PRSI-Free Allowance are:
Class B, C, D
PRSI contribution weeks
A contribution week is each successive period of seven days starting on 1 January each year. Week 1 is the period from 1 to 7 January inclusive, week 2 from 8 to 14 January and so on.
For 2010, the contribution week starts on a Friday and ends on a Thursday.
A contribution at the appropriate class should be awarded to an employee for each contribution week or part of one, for which he or she is in insurable employment.
People who were insured at Classes A, B, C, D, H or S and who are no longer insurably employed may opt to pay Voluntary Contributions to provide cover for pensions.
Applications must be made within 12 months from the end of the PRSI contribution year in which a PRSI contribution was last paid or credited. For more information, log on to
http://www.welfare.ie/ or contact:
Voluntary Contribution Section
Telephone: (051) 356 000 ext. 46006/7