Ireland

Ireland uses a two-rate income tax system: 20% on the first EUR 42,000 (for single individuals; EUR 51,000 for married couples with one income) and 40% on all income above this threshold. The Universal Social Charge (USC) adds 0.5-8% depending on income level. Pay Related Social Insurance (PRSI) is 4% for most employees. Employer PRSI is 8.8% on earnings up to EUR 441 per week and 11.15% above that threshold. Total employer costs are relatively moderate compared to continental Europe. Employee tax credits reduce tax liability: personal credit of EUR 1,875, employee credit of EUR 1,875, and various other credits. Ireland's pension system relies heavily on private provision. Auto-enrolment is being phased in, with employer contributions starting at 1.5% and increasing to 6% over 10 years. Tax relief on pension contributions is available at the marginal rate, up to age-dependent percentage limits. Capital gains are taxed at 33%, one of the higher rates in Europe. Dividend income is taxed as part of general income. VAT is 23% with reduced rates of 13.5% and 9%. Ireland's corporate tax rate of 12.5% on trading income (15% for companies within the OECD Pillar Two scope) has been central to attracting multinational headquarters. The Special Assignee Relief Programme (SARP) offers a 30% income tax exemption on earnings above EUR 75,000 for qualifying assignees, for up to 5 years.