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BUDGET 2025 HAS officially been announced, with a range of one-off payments and some changes to taxes charged on income.
Minister for Finance Jack Chambers announced a number of changes to tax this afternoon, including:
An increase to the entrance to the higher rate of tax for PAYE workers (from €42,000 to €44,0000).
The measures will affect people differently depending on their income. You can find out what exactly they mean for you with The Journal’s Budget Calculator.
For a person earning an annual income of €20,000, here’s a breakdown of how your tax will (or won’t) change.
We’ll also be bringing you examples of what it means for people earning €40,000, €60,000 and €100,000 as well as our full Budget coverage on government spending, social welfare, and other changes.
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PAYE
The changes to PAYE will only affect people earning over €42,000, as the threshold has been raised to €44,000.
If you are earning €20,000 a year, you are already only paying the lower rate of tax and so there will be no difference.
Personal tax credits and employee tax credits are increasing by €125 each.
That means savings on PAYE for a single person earning €20,000 will amount to zero from the PAYE changes and €250 from changes to credits.
USC
Changes to USC have also been announced with the 4% rate cut to 3% on incomes between €25,000 and €70,000.
However, for a person earning €20,000 there will be no change to the amount of USC they pay:
0.5% on the first €12,012 = €60
2% on the amount between €12,012 and €20,000 = €275
This is the same as what they will pay in 2025.
Total
The only tax savings for people on €20,000 will be €250.
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Who earns just €20k per year? The minimum wage is €12.70 per hour. Based on a working week of 37.5 hours that equates to over €24,000 per year. I am at a loss to understand the point of this article unless – without actually saying so- it is referring to part-time workers.
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