http___www.welfare.ie_ga_Pages_Compensation-for-Loss-of-Employment---Taxation-of-Lump-Sum.aspx_1.xml
1.1 2.1 3.1 3.2 4.1 5.1 6.1 6.2 7.1 7.2 8.1 8.2 9.1 9.2 10.1 11.1 12.1 13.1 14.1 15.1 16.1 16.2 17.1 18.1 19.1 20.1 20.2 21.1 22.1 23.1 24.1 25.1 26.1 27.1 28.1 29.1 30.1 30.2 31.1 32.1 33.1 34.1 35.1 36.1 37.1 38.1 39.1 40.1 41.1 42.1 43.1 43.2 44.1 45.1 46.1 47.1 48.1 49.1 50.1 51.1 51.2 52.1 52.2 53.1 53.2 54.1 55.1 56.1 58.1 59.1 60.1 62.1 63.1 64.1 66.1 67.1 68.1 68.2 69.1 70.1 71.1 71.2 72.1 73.1 74.1 75.1 76.1 77.1 78.1 79.1 79.2 80.1 81.1 81.2 82.1 82.2 83.1 84.1 85.1 86.1 87.1 88.1 89.1
Introduction There are various circumstances in which people receive compensation for loss of employment. The most common is where you are made redundant and you get a settlement, which may include the statutory redundancy lump sum, and a further sum negotiated by you or your trade union with the employer. When you retire you may be paid a lump sum by your employer. If you had a fixed-term contract and it is ended early, you may get a lump sum in compensation. This document is about the taxation of your redundancy or retirement lump sum. It is not about the tax treatment of your pension scheme lump sum. If all of your lump sum is statutory redundancy, or if it is a payment made on account of injury or disability, (subject to a maximum lifetime tax-free limit of €200,000), no tax is payable and therefore the rest of this document does not apply to you. If you receive a lump sum in compensation for the loss of employment, part of it may be tax free. The following payments are tax free: The following payments are not exempt from tax but may qualify for some tax relief – see ‘Tax-free entitlements’ below. - A non-statutory redundancy payment, that is, the amount paid by your employer, which is over and above the statutory redundancy payment. This is also known as an ex-gratia payment. - Payment in lieu of notice (However, if your contract of employment provides for a payment of this kind on termination of the contract, you pay tax and PRSI in the normal way.) Tax-free entitlements On a redundancy or retirement payment, you are entitled to one of the following tax exemption options, whichever is the higher. Basic Exemption The Basic Exemption due is €10,160, plus €765 for each complete year of service. (This does not include statutory redundancy which is tax free.) Basic Exemption plus Increased Exemption An additional €10,000 called the Increased Exemption is also available in the following certain circumstances: - If you haven't received a tax-free lump sum in the last 10 years and you are not getting a lump sum pension payment now or in the future If you are in an occupational pension scheme, the Increased Exemption is reduced by any tax-free lump sum from the pension scheme you may be entitled to receive. Standard Capital Superannuation Benefit (SCSB) This is an additional relief due that normally benefits people with higher earnings and long service. It can be used if the following formula gives an amount greater than either basic exemption or Basic Exemption plus Increased Exemption. Formula for SCSB: Take the average annual earnings over the previous 3 years (or the whole period of service, if less than 3 years), multiply this figure by the number of years service; divide by 15 and subtract the lump sum superannuation payment received or that may be receivable. Example: You were made redundant in 2014 after 20 years' service and received a lump sum of €100,000 which is your first lump sum. You also got a lump sum of €20,000 from your pension scheme. Your pay for the last 3 years before the date of leaving work was €180,000. The amount of the lump sum which is exempt from tax is the higher of the following 2 calculations: - The Basic Exemption is: There is no Increased Exemption as the pension scheme lump sum of €20,000 is greater than €10,000 - The Standard Capital Superannuation Benefit (SCSB) is: The taxable amount of your lump sum is therefore €40,000 (€100,000 - As the above example shows the SCSB tax relief of €60,000 is a higher amount of tax relief than the Basic and Increased Exemptions of Calculation of tax A certain amount of your redundancy payment is tax free, as described above, and the balance will be taxed. This is taxed as part of the current year's income. Previously there was a second method based on your average rate of tax for the previous 3 years. This was known as Top Slicing Relief which was not available on lump sums of €200,000 or more paid on or after 1 January 2013 and was abolished for all ex-gratia lump sum payments made on or after 1 January 2014. The amount of your lump sum that is subject to tax is not subject to social insurance (PRSI), but the Universal Social Charge may be payable. How to apply Your employer is obliged to deduct tax from all your income. He/she may take account of the basic exemption, that is the €10,160 plus €765 for each year of service. Revenue may inform the employer about the correct amount to be treated as tax free and the rate of tax to be applied to the rest. If this does not happen or if it is incorrect and you have paid too much tax, you should contact your regional Revenue office to claim a refund - see 'Where to apply' below. You must declare the fact that you have received such a lump sum on your annual return of income to Revenue. There is more detailed information in Revenue's leaflet Lump Sum Payments on Redundancy/Retirement.
1.1 2.1 3.1 3.2 4.1 5.1 6.1 6.2 7.1 7.2 8.1 9.1 10.1 11.1 11.2 12.1 13.1 14.1 15.1 16.1 17.1 18.1 19.1 20.1 21.1 22.1 23.1 24.1 25.1 26.1 27.1 28.1 29.1 30.1 30.2 31.1 32.1 32.2 33.1 34.1 35.1 36.1 37.1 38.1 39.1 40.1 41.1 41.2 41.3 42.1 43.1 43.2 44.1 45.1 47.1 48.1 49.1 51.1 52.1 53.1 54.1 55.1 56.1 57.1 57.2 58.1 59.1 60.1 60.2 61.1 62.1 63.1 64.1 65.1 66.1 67.1 68.1 69.1 69.2 70.1 71.1 71.2 72.1 73.1 73.2 74.1 75.1 76.1 77.1 78.1 79.1 80.1 81.1
Réamhrá Tá cúinsí éagsúla lena bhfaigheann daoine cúiteamh airgid nuair a chailleann siad a gcuid fostaíochta. Don chuid is mó is íocaíocht iomarcaíochta atá i gceist, an cnapshuim iomarcaíochta dleathúla, móide, b'fhéidir suim eile a shocraíonn tú nó do cheardchumann leis an bhfostóir. Nuair téann tú ar scor, d'fhéadfadh go n-íocann d'fhostóir cnapshuim leat. Má bhí conradh ar feadh tréimhse faoi leith agat agus má chuirtear deireadh go luath leis, d'fhéadfadh sé go mbeadh cnapshuim curtha ar fáil duit mar chúiteamh. Má fhaigheann tú cnapshuim mar chúiteamh ar do fhostaíocht a chailliúint d'fhéadfadh sé nach mbeadh cáin le n-íoc agat ar chuid de. Tá na híocaíochtaí seo a leanas saor ó cháin: - Cnapshuim iomarcaíochta dleathúla Teidlíochta saor ó cháin Nuair a fhaigheann tú íocaíocht iomarcaíochta nó scoir tá tú i dteideal an méid níos airde seo leanas a fháil: Bundíolúine Ní ghearrtar aon cháin ar an gcéad €10,160 sa bhreis ar sin tá €765 ar son chuile bhliain seirbhíse saor ó cháin. (Ní chuirtear an chnapshuim dleathúil san áireamh) Bundíolúine móide Díolúine Méadaithe Tá €10,000 méid breise, an díolúine méadaithe dá ngairtear, ar fáil faoi choinníollacha seo a leanas: - Ní bhfuair tú cnapshuim saor ó cháin le 10 bliana anuas agus nach bhfuil cnapshuim pinsin dhá fháil agat anois nó san am atá le teacht Má tá scéim phinsin cheirde le fáil agat laghdófar an díolúine méadaithe den chnapshuim pinsin atá saor ó cháin. Sochar Caighdeánach Pinsin Chaipitil (SCSB) Is faoiseamh breise dlíte é. Is iondúil go bhfuil an faoiseamh seo níos fearr do dhaoine a bhfuil blianta fada seirbhíse acu agus a mbíodh tuarastal níos airde dhá fháil acu. Má thugann an fhoirmle seo a leanas méid is mó ná Bundíolúine nó Bundíolúine móide Díolúine Méadaithe beidh an faoiseamh dlíte. Seo í an fhoirmle SCSB: Tóg an meánphá bliantúil le 3 bliana (nó iomlán tréimhse sheirbhíse más níos lú ná 3 bliana) agus méadaigh faoin líon blianta seirbhíse, roinn faoi 15 agus bain as iomlán an cnapshuim pinsin má íocadh é nó dá n-íocfaí é. Sampla: Fágadh iomarcach tú in 2014 i ndiaidh 20 bliain i seirbhís agus fuair tú cnapshuim de €100,000 agus é ina chéad chnapshuim agat. Fuair tú cnapshuim de €20,000 ó do scéim pinsean chomh maith. Ba é €180,000 an pá a bhí agat do na 3 bliana deireanacha roimh an dáta ar ar fhág tú an obair. Is é méid na cnapshuime atá díolmhaithe ó cháin ná an ceann is airde den 2 ríomhaireacht seo a leanas: - Is é an Bundíolúine ná: Níl aon Díolúine Méadaithe toisc go bhfuil an chnapshuim de €12,000 ón scéim pinsean níos mó ná €10,000 - Is é an Sochar Aoisliúntais Caipitiúil Caighdeánach (SACC) ná: Is é méid na cnapshuime atá díolmhaithe ó cháin ná €40,000. Mar a léirítear sa sampla thuas tá faoiseamh cánach an SACC de €60,000 ina fhaoiseamh cánach níos airde ná an Bhundíolúine agus an Díolúine Méadaithe de €25,460. Cáin a mheas Beidh méid áirithe den íocaíocht atá saor ó cháin agus beidh an fuílleach inchánaithe. Gearrtar an cháin ar an airgead mar chuid d’ioncam na bliana reatha. Roimhe seo bhí dara modh ann a ghearradh cáin air ag an meánráta cánach a bhí le híoc agat le 3 bhliana roimhe. Faoiseamh Barrscoitheadh atá air agus ní raibh sé ar fáil le haghaidh cnapshuimeanna €200,000 nó níos mó a íocadh ar nó i ndiaidh 1 Eanáir 2013 agus cuireadh deireadh iomlán leis le haghaidh cnapshuimeanna íoctha ar nó i ndiaidh 1 Eanáir 2014. Níl aon ÁSPC le n-íoc ar an gcuid den chnapshuim a bhfuil cáin le n-íoc air, ach d'fhéadfadh sé go mbeadh an Muirear Sóisialta Uilíoch le n-íoc air. Conas iarratas a dhéanamh Tá sé de dhualgas ar an bhfostóir cáin a bhaint as d'ioncam ar fad. Ní mór dó/dí an bunchóras a úsáid i.e., an €10,160 móide €765 do chuile bhliain seirbhíse. D'fhéadfadh na Coimisinéirí Ioncaim a chur in iúl don fhostóir cé mhéid atá saor ó cháin de réir na rátaí reatha agus cén ráta cánach atá i gceist don chuid eile. Muna dtarlaíonn seo nó má dhéantar botún agus go n-íocann tú an iomarca cánach ba chóir duit iarratas a dhéanamh chuig an oifig cánach reigiunach ar aisíocaíocht na cánach - féach 'Cá háit a dhéanfaidh mé iarratas'. Ní mór duit a chur in iúl ar an tuairisc bhliantúil ioncaim chuig na Coimisinéirí Ioncaim go bhfuil cnapshuim faighte agat. Tá tuilleadh eolais sa bhileog Cnapshuim Iomarcaíochta maidir leis Iomarcaíocht/Scor foilsithe ag an Coimisinéirí Ioncaim.