WORKERS paying PAYE can see the immediate impact of the 1996 Budget measures on take-home pay from these tables. Take the gross income closest to your own in the first column, then refer across the table to see how your take home- pay will change in the 1996/97 tax year.
The impact of the Budget measures on single taxpayers and on married couples with one spouse earning is shown.
Private and public sector employees are shown separately because public sector employees pay PRSI contributions at a lower 0.9 per cent rate while private sector workers pay at a 5.5 per cent rate. For public sector workers the first £20 of weekly income will be exempt from PRSI in 1996/97 while for private sector workers the first £80 of weekly income will be exempt.
The widening of the standard 27 per cent tax band, the increase in the personal allowance and the exemption of the first £80 of weekly income from PRSI will benefit all PAYE taxpayers.
Lower-paid workers will benefit most from the PRSI changes. The removal of the £140 PRSI tax allowance and the increase in the income ceiling for PRSI payments from £21,500 to £22,300 will claw back these benefits from higher paid workers.
The rise in the income ceiling will add £41 to the annual PRSI bill of a worker earning £40,000 before any other Budget measures. It will not affect a worker earning £15,000 because all of his/her income is already well within the existing ceiling.
The removal of the £140 PRSI allowance will add £38 to the bill of a 27 per cent tax payer but £67 to the tax bill of a 48 per cent taxpayer.
On its own, the increase in the amount of weekly income exempted from PRSI from £50 to £80 will cut the PRSI bill of a £10,000 earner by £86 and the bill of the £40,000 earner by £47. Overall the PRSI changes on their own will increase the tax bill of the £40,000 earner by £60 while the tax bill of a £10,000 earner will fall by £48.