PRSI 4% HEALTH CONTRIBUTION

DUBISAK

Does anyone know how to go about claiming back 4% PRSI HEALTH CONTRIBUTION and how long does it take?

Legend100

You need to fill out form PRSIREF1 which is available at

http://www.welfare.ie/EN/Forms/Documents/prsiref1.pdf

It is taking considerably long to et the refund at the moment as i gave been told it can be 6 months with the backlog they have

Mr. Incognito

You need to contact the PRSI department to get a statement of PRSI paid. www.welfare.ie

Then you fill out the form and send it off- I had a delay of 5 months on mine about a year ago so i reckon it's longer now.

DUBISAK

Thank you both.

So when I claim for this and it is processed successfully, will they automaticaly stop taking this 4% contribution from my wage, or do I need to pay and claim back every year?

Mr. Incognito

Sorry you seem to be under a bit of a misaprehension here. You can only claim it for weeks that your salary is less than 127 euro a week.

Legend100

It is the health that he wants to claim Mr Incognito so it is the 500 per week threshold if he/she is a paye worker and class A

Mr. Incognito

PRSI of 4% is only repayable if income is under 127 a week.

The Income levy:

1.2 Who is liable for the income levy?

All individuals are liable to pay the income levy if their gross income exceeds the threshold of €15,028
p.a., (€289 per week) or if they exceed the income exemption limit of €20,000 p.a. for an individual aged
65 or over.

In the specific circumstances where an employer or pension provider has already applied the higher
exemption limit of €352 to weekly payments made prior to 1 May 2009 (using the annual threshold of
€18,304 as set out in the Finance (No. 2) Act 2008) Revenue will not seek to recover any underpayment
of levy for this period arising as a result of the application of this higher exemption. This special
provision only applies in respect of payments actually made in the period between 1 January 2009 and 30
April 2009.

http://www.revenue.ie/en/practitioner/law/income-levy.pdf

Here is a good synopsis:

PRSI & Health Contributions - Employers/Employees

Class A (Normal rate at which contributions are made)

Tax Year 2007
Employee’s Income chargeable as below: Total Employer’s rate
Earnings up to €48,800 to PRSI @ 4% plus a Health Contribution of 2% 6% 10.75%
Earnings from €48,800 to €100,100 to a Health Contribution of 2% 2% 10.75%
Earnings over €100,100 (€1,925 per week, €3,850 per fortnight & €8,342 per month) to a Health Contribution of 2.5% 2.5% 10.75%
Tax Year 2008
Employee’s Income chargeable as below: Total Employer’s rate
Earnings up to €50,700 to PRSI @ 4% plus a Health
Contribution of 2%
6% 10.75%
Earnings from €50,700 to €100,100 to a Health Contribution of 2%
2% 10.75%
Earnings over €100,100 (€1,925 per week, €3,850 per fortnight & €8,342 per month) to a Health Contribution of 2.5% 2.5% 10.75%
Note: For 2007 and 2008 an additional 0.5% Health Contribution has been introduced on earnings exceeding €1,925 per week (equivalent to €3,850 per fortnight and to €8,342 per month)

Employees are exempt from PRSI on the first €127 per week or €26 per week for employees on a modified PRSI rate. Employees earning €352 or less per week in 2008 (€339 in 2007) are exempt from PRSI and Health Contribution. However, where earnings exceed €352 per week in 2008 (€339 in 2007), the employee’s PRSI Free Allowance remains at €127 per week or €26 per week for employees on a modified PRSI rate. Employees earning €500 or less per week in 2007 (€480 in 2007) and are exempt from Health Contribution of 2%.

Note: Recipients of a Social Welfare Widow’s or Widower’s Pension, Deserted Wife’s Benefit/Allowance or One-Parent Family Payment are exempt from paying the 2% Health Contribution. All Medical Card holders (including people aged 70 or over) are also exempt from this contribution.

http://www.revenue.ie/en/tax/it/leaflets/it1_08.html#section18

Hope that helps and clarifies the situation.

Legend100

still don't know what you mean with the 127 euro Incognito because the OP is looking to reclaim the 4% health contribution (not prsi or income levy) and can do so if his/he wages are under 500 per week

From welfare.ie:

Where an employees weekly pay fluctuates above and below €500, but the annual pay during 2008 is not more than €26,000, the employee may claim a refund of the 2% Health Contribution deduction, or where an employees weekly pay fluctuates above and below €1,925, but the annual pay during 2008 is not more than €100,100, the employee may claim a refund of the 0.5% Health Contribution deduction from the Department of Social Affairs


Obviously this quote from welfare.ie needs to be updated with the increased health levy of 4% from the mini budget in 2009.

To the OP:

No you cannot reclaim the health levy through your payroll unfortunately as it is not a cumulative system, it works on a weekly/fortnightly,montlhy basis unlike our paye system. If your gross is under the 26K for 2009, then you can reclaim the health levy paid for the year