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Image: Bilanol/Shutterstock
Image: Bilanol/Shutterstock
THE GOVERNMENT ANNOUNCED a raft of measures and initiatives as part of Budget 2018 today. They include tax cuts – and increases – as well as extra spending in areas like crime and health.
But what will it all mean for your bank balance next year? If you’re currently earning around €100,000, here’s what will change.
Private and public sector workers
Finance Minister Paschal Donohoe announced that the point at which an earner attracts the higher rate of income tax will rise next year by €750. The entry point for single earners will increase from €33,800 to €34,550.
For those earning more than €100,000, this will result in a saving of €150 next year.
As for the Universal Social Charge (USC), it was announced that the 2.5% rate will be reduced to 2% and the ceiling for this new rate will increase from €18,772 to €19,372. Meanwhile the 5% rate will drop to 4.75%.
If you’re earning €100,000, you’re paying USC across four rates, totalling €5,189.
Next year, here’s how it will play out for you:
- 0.5% on the first €12,012 = €60.06
- 2% on up to €19,372 = €147.20
- 4.75% on up to 70,044 = €2,406.92
- 8% on the rest up to €100,000 = €2,396.48
That’s a total of just under €5,011 and a saving of €178.
Total saving: €328
Self-employed workers
If you are self-employed and currently earning €100,00o, you will benefit from the €150 income tax saving and the €178 USC saving detailed above.
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However, Donohoe also announced a €200 increase in the Earned Income Credit which will benefit 147,000 self-employed people in Ireland.
This means an extra €200 saving in income tax for these earners.
Total saving: €528
Other
If you have children, there may be some additional savings for you as the government has pledged €20 million to support a number of measures, including an extended free pre-school programme.
But if you are a fan of fizzy drinks, cigarettes or sunbeds, you’ll also be paying more for those.
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