Question on new PRSI threshold

djk1000

I'm fairly new to having to calculate and understand PRSI, I know this has been a messy year too! Could someone please explain by example how PRSI is dealt with, where a person earns over €52,000 prior to May 1st when the new threshold came in???

Thanks in advance.

D

misspiggy40

Hi there. Have a look at this link. If it does not make sense to you, post again

http://www.welfare.ie/EN/Publications/SW14/sw14_09/Pages/ClassA.aspx

djk1000

Thanks for that, but what I want to know specifically is what happens when someone has earned past the threshold of €52k before 30th April 2009. From May 1st 2009, the threshold increased to €75,036. How is PRSI calculated from May to December?

namenotavailablE

See this link:

http://www.welfare.ie/EN/Publications/sw14_apr09/Pages/ImportantInformation.aspx

Particularly this paragraph:

Employees who reach the PRSI ceiling prior to 1 May 2009

Most employees will not have reached the previous PRSI ceiling of €52,000 by 1 May 2009 and will therefore, continue to pay PRSI up to the revised ceiling of €75,036.
Where an employee reached the PRSI ceiling of €52,000 prior to 1 May 2009, earnings from 1 May 2009 to 31 December 2009 will be subject to a ceiling of €23,036 i.e the employee concerned, having ceased payment of PRSI prior to May 1, will recommence payment of PRSI on earnings from May 1 and will, over the course of the year, pay up to the €75,036 ceiling.
(Where an employee commences employment and presents a P45 dated after May 1, the employer should assume that total income, as recorded on the P45, has been subject to the correct rate of PRSI.)