2016 PRSI Changes for certain employees and employers


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1. 2016 PRSI Changes

Employees 

Employees earning between €352.01 and €424 in a week and who pay Class A PRSI, will be entitled to a new weekly PRSI Credit which will reduce the amount of PRSI deducted from their earnings in that week.

(A similar PRSI Credit will apply to Class E and Class H employees with weekly earnings between €352.01 and €422 or €424, respectively.)

There will be no changes for:

  • employees earning over €424 in a week and paying PRSI under Class A;
  • employees paying PRSI under Classes B, C, D, or J.

Employers

Employers of Class A employees earning between €356.01 and €376.00 in a week will pay employer PRSI at the rate of 8.5%, from 1 January 2016.

There will be no changes for employers of Class A employees earning over €376 in a week, or for employers of employees paying PRSI under other PRSI classes. 

Self-employed/Other Contributors

There will be no changes for contributors paying PRSI Class S or for contributors paying PRSI under other PRSI classes (i.e. Classes K or M).

 

2. Class A Employee PRSI

PRSI Class A caters for private sector employments with earnings of €38 or more in a week and for civil and public servants recruited after April 1995.

From 1 January 2016, if you

  • earn between €352.01 and €424.00 in a week, and
  • are a Class A employee,

you are entitled to a weekly PRSI Credit.  The weekly PRSI Credit will reduce the amount of your PRSI charge so that you pay a lower amount of PRSI in a week.  

There is no PRSI Credit once your earnings exceed €424.

 

3. Calculation of the Class A PRSI Credit

Class A employee PRSI will continue to be calculated at 4% of gross weekly earnings.

For gross earnings between €352.01 and €424 in a week, the 4% PRSI charge will be reduced by the new PRSI Credit.

The amount of the PRSI Credit depends on your gross weekly earnings.

At gross weekly earnings of €352.01, the maximum PRSI Credit of €12.00 per week applies.

For earnings between €352.01 and €424, the maximum weekly PRSI Credit of €12.00, is reduced by one-sixth of earnings in excess of €352.01.

The following example shows how to calculate the PRSI Credit and the new PRSI charge, for gross weekly earnings of €377.

PRSI Credit    
Maximum PRSI Credit €12.00  
One-sixth of earnings in excess of €352.01
(377.00 – 352.01 = 24.99 / 6)
 (€4.17)  
Reduced PRSI Credit   €7.83  
PRSI @ 4%   €15.08
Less: Reduced PRSI Credit   €7.83
New 2016 weekly PRSI Charge    €7.25

Your employer will make the adjustment to the amount of PRSI you are charged, from 1 January 2016.

 

4. Class A Employer PRSI

Currently Class A employers pay PRSI at the rate of 8.5% for employees earning between €38 and €356 in a week.  For weekly earnings in excess of €356, the rate of employer PRSI is 10.75% on all earnings.

With effect from the 1 January 2016, the weekly earnings threshold for moving from the 8.5% to the 10.75% rate of employer PRSI, will increase from €356.01 to €376.01.  This means employers whose employees have gross weekly earnings between €356.01 and €376 will pay the lower 8.5% rate of employer PRSI.

Last modified:14/10/2015