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Q. What is the new Universal Social Charge? Who has to pay
it?
04.01.11
The Universal Social Charge is a new tax payable on your gross
income, including benefit in kind payments. It is deducted before
pension contributions. It replaces the health contribution and the
income levy and comes into effect on 1 January 2011. It does not
replace the Pay Related Social Insurance (PRSI) system.
Everyone (including medical card holders) is liable to pay the
Universal Social Charge if their gross income is over the threshold
of €4,004 in a year. All Department of Social Protection payments
(including State pensions and Child Benefit) and similar payments
(for example, CE schemes and Back to Education Allowance) and income
on which DIRT has been paid are exempt.
The rates of the Universal Social Charge are: 2% on the first
€10,036; 4% on the next €5,980; 7% on the balance. People over 70
are not liable for the 7% rate but pay at 2% on income up to €10,036
and at 4% on all their income above €10,036.
The Universal Social Charge will be deducted from all income. If you
have earned less than €4,004 during the year, you can apply to your
local Revenue office for a refund at the end of the year.
Citizens Information: Buncrana 074 9363496; Carndonagh 074 9373741
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