Are you a PAYE worker and struggle to understand the information that is included on your Payslip?

Nuala McGowan, ACA, CPA, AIA, and founder of McGowan Accountancy Services is a qualified tax expert and is available to take your through your Payslip line by line, and help you to get to grips with how your wages are calculated.

For more information contact Nuala on (090) 66 25818 or email nuala@mcgowanaccountancy.com

Here’s a quick guide to get you started:

An Pay As You Earn Payslip shows how your wages are calculated and how much tax and other deductions are taken before you receive your net pay.

Here’s a clear breakdown of the typical sections:

1. Gross Pay

This is your total earnings before any deductions.

It may include:

  • Basic salary or hourly wages

  • Overtime

  • Bonuses or commission

  • Allowances (e.g. travel, shift pay)

2. PAYE (Income Tax)

This is your income tax deducted by your employer on behalf of the government.

  • Calculated based on your tax credits and rate band

  • Usually split into:

    • Standard rate (20%)

    • Higher rate (40%) (if you earn above the threshold)

Your payslip may show:

  • Tax this period

  • Cumulative tax (total paid so far this year)

3. USC (Universal Social Charge)

A separate tax based on your income level.

  • Charged in bands (e.g. low %, then higher % as income increases)

  • Applies to most income, even if you pay little PAYE

4. PRSI (Pay Related Social Insurance)

This is your social insurance contribution.

  • Funds things like:

    • State pension

    • Illness benefit

    • Jobseeker’s payments

Most employees pay Class A PRSI.

5. Other Deductions (if applicable)

These vary depending on your job:

  • Pension contributions

  • Health insurance

  • Union fees

  • Salary sacrifice schemes (e.g. bike-to-work)

6. Total Deductions

The sum of:

  • PAYE

  • USC

  • PRSI

  • Any additional deductions

7. Net Pay

This is your take-home pay — what actually goes into your bank account.

Formula:

Gross Pay − Total Deductions = Net Pay

8. Year-to-Date (YTD) Figures

Most Irish payslips show cumulative totals since January 1st:

  • Total gross pay so far

  • Total tax paid

  • Total USC and PRSI

This helps track your overall earnings and tax position.

9. Tax Credits & Cut-Off Point

Sometimes shown on payslips:

  • Tax credits reduce how much PAYE you pay

  • Standard rate cut-off point = how much of your income is taxed at 20% before hitting 40%

10. Other Info

  • Employer details

  • Your PPS number (like a tax ID)

  • Pay period (weekly/monthly)

  • Revenue payroll number