Universal Social Charge
aka USC
Irish payroll tax on gross income deducted at source by employers via PAYE and reported in real time under PAYE Modernisation. Bands, rates and exemption thresholds are set in the annual Finance Act.
Last reviewed April 2026
Definition
Universal Social Charge (USC) is an Irish payroll tax introduced in 2011 to replace the income levy and health contribution. It is calculated on gross income before pension or PRSI deductions and applies to most income above a low annual threshold. USC is charged in tiered bands, with the rate increasing across higher bands. Employers deduct USC at source through PAYE and submit the figures with each Payroll Submission Request (PSR) to Revenue. The bands, rates, and exemption threshold are reviewed every year in the Budget and confirmed in the Finance Act, so payroll software must be updated to reflect new bands each January. Medical card holders, those over 70 with low income, and a small number of other categories qualify for a reduced rate. Self-employed individuals over a higher income threshold also pay USC at a surcharge rate.
Why it matters for software choice
USC bands change every year and are applied per pay period using the cut-off points from the employee's RPN. Payroll software that auto-applies the latest bands and handles split exemption rules removes the largest source of USC error in Irish payroll.
Authority sources
- Revenue: Universal Social Charge (www.revenue.ie)
Software categories this affects
Vendors covered by this term
BrightPay
Award-winning Irish payroll with full PAYE Modernisation and Revenue integration
Collsoft Payroll
Irish payroll built for construction and mid-size businesses with RCT and CSO reporting
Thesaurus Payroll Manager
Ireland's most affordable PAYE-compliant payroll at just EUR 175 per year
Sage Payroll (Ireland)
Irish payroll from Sage with PAYE Modernisation and Revenue submissions
Surf Payroll
Irish payroll module from Surf Accounts for bureaus and small businesses
Related terms
PAYE Modernisation
Ireland's real-time payroll reporting regime, introduced by Revenue on 1 January 2019. Every payroll run must submit data to Revenue on or before the date employees are paid.
PRSI (Pay Related Social Insurance)
Ireland's social insurance contribution deducted at source by payroll. Most employees are on Class A1, with employee PRSI at 4.1% and employer PRSI at 8.9% (lower rate) or 11.15% (higher rate) from October 2024 rates.
Employment Detail Summary
Annual statement employees download from Revenue MyAccount showing total pay, tax, USC and PRSI for the year. Replaced the P60 from 2019 onward under PAYE Modernisation.