Budget 2027: proposed PAYE bands, tax credits and USC changes
The single-person PAYE band is proposed to rise to €46,500, the Personal and Employee Credits to €2,125, and the USC 2% ceiling to €30,300. These Budget announcements remain subject to legislation.
Budget announcements — subject to legislation; scheduled PRSI increase shown separately · Official announcement
What was announced on 6 October
Budget 2027 proposes changes to Irish payroll bands and credits for the new tax year. Revenue explains that the Government must seek the necessary legislative changes through the Oireachtas. An announcement is not confirmation that those changes are already enacted or available in payroll software.
The headline proposals are a wider 20% PAYE band, larger main tax credits and a higher ceiling for the 2% USC band. The tax and minimum-wage proposals below are intended for 1 January 2027; the employer PRSI threshold is announced for 2027, with its exact commencement still to be confirmed in the implementing material.
2026 reference values and the announced 2027 figures
Income-tax rates remain 20% and 40%. For a two-income couple, the proposed €55,500 band can be increased by the lower of €37,500 or the lower earner’s income. €93,000 is therefore a maximum, not an automatic entitlement for every couple. Credits depend on eligibility and the employee’s actual RPN allocation.
A wider PAYE band moves some taxable income into the lower rate; a tax credit reduces the resulting Income Tax liability. The employer PRSI threshold affects employer cost. The minimum wage sets a gross hourly pay floor. Neither is itself a new employee tax deduction.
| Parameter | 2026 reference | 2027 announcement |
|---|---|---|
| Single, widowed or surviving civil partner: 20% band | €44,000 | €46,500 |
| Qualifying Single Person Child Carer: 20% band | €48,000 | €50,500 |
| Married or civil partners, one income: 20% band | €53,000 | €55,500 |
| Married or civil partners, two incomes: maximum combined 20% band | €88,000 | Up to €93,000 |
| Personal Tax Credit, single person | €2,000 | €2,125 |
| Employee PAYE Tax Credit | €2,000 | €2,125 |
| Earned Income Tax Credit | €2,000 | €2,125 |
| Home Carer Tax Credit | €1,950 | €2,050 |
| Standard USC: cumulative ceiling of 2% band | €28,700 | €30,300 |
| Adult national minimum wage, per hour | €14.15 | €14.94 |
| Lower employer Class A PRSI threshold, weekly | €552 | €600 proposed for 2027 |
USC: the second-band proposal is clear; one upper boundary needs clarification
The Government announces a €1,600 increase in the cumulative ceiling of the 2% USC band. The standard percentages shown are 0.5%, 2%, 3% and 8%. This article does not present a complete, finalised 2027 USC table.
The detailed Tax Policy Changes PDF, printed page 4, lists €70,444 as the upper boundary of the 3% band. Revenue’s current 2026 slices add up to €70,044. That difference needs authoritative clarification before we can describe every 2027 boundary as unchanged or use a complete 2027 table in the tools.
PRSI: an existing October 2027 change, separate from the Budget proposals
The PRSI roadmap already provides for an increase of 0.15 percentage points from 1 October 2027. It is separate from the newly announced employer-threshold proposal. The timetable is supported by the Department of Social Protection’s roadmap and the Social Welfare (Miscellaneous Provisions) Act 2024.
- The table is a dated roadmap summary, not a blanket percentage for every Class A employee. Exemptions, credits, subclasses and special employments need their own rules.
- The lower employer threshold and the October percentage increase are different changes. Do not replace one with the other or use one employee PRSI percentage for the entire year.
| Component | 1 January–30 September 2027 | From 1 October 2027 |
|---|---|---|
| Employee, where chargeable at the ordinary rate | 4.35% | 4.50% |
| Employer, ordinary lower rate | 9.15% | 9.30% |
| Employer, ordinary higher rate | 11.40% | 11.55% |
What this means when comparing take-home pay
Keep gross pay, frequency, tax-credit allocation and pension assumptions consistent when comparing years. A change to one band or credit is not a complete net-pay comparison: USC, PRSI, eligibility and the pay date also matter.
NettoGross Éire’s current tools remain on their existing year-specific rules. The separate project update explains the proposed review work. Budget 2027 also proposes a more flexible ERR reporting timetable; that is a reporting-process change, discussed in the project article, rather than a new net-pay deduction.
Official sources
- Revenue — Budget information and the legislative process (checked 7 October 2026)
- Department of Finance — Budget 2027 Taxation Measures (Tax Policy Changes, printed pages 4 and 12)
- Government — Your guide to Budget 2027
- Department of Finance — Budget 2027 speech, including the proposed employer PRSI threshold
- Department of Social Protection — PRSI roadmap and 2024 legislation
- Department of Social Protection — current Class A rates, including October 2026
- Revenue — current standard USC tables for the 2026 comparison
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These explanations support learning and indicative estimates. Check the official guidance for your circumstances. Report a correction.