Here's what Budget 2025 means for your payslip if you're earning €40,000
by David MacRedmond, https://www.thejournal.ie/author/david-macredmond/ · TheJournal.ieBUDGET 2025 HAS officially been announced, with a range of one-off payments and some changes to taxes charged on income.
Minister for Finance Jack Chambers announced a number of changes to tax this afternoon, including an increase to the entrance to the higher rate of tax for PAYE workers (from €42,000 to €44,0000).
The measures will affect people differently depending on their income. You can find out what exactly they mean for you with The Journal’s Budget Calculator.
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For a person earning an annual income of €40,000, here’s a breakdown of how your tax will change.
We’ll also breaking down what it means for people earning €20,000, €60,000 and €100,000 as well as our full Budget coverage on government spending, social welfare, and other changes.
PAYE
The changes to PAYE will only affect people earning over €42,000, as the threshold has been raised to €44,000.
If you are earning €40,000 a year, you are already paying the lower rate of tax and so there will be no difference.
Personal tax credits and employee tax credits are increasing by €125 each.
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That means savings on PAYE for a single person earning €40,000 will amount to zero from the PAYE changes and €250 from changes to credits.
USC
Changes to USC have also been announced with the 4% rate cut to 3% on incomes between €25,000 and €70,000.
So for a person earning €40,000 there will be a saving of €159.
Total
The tax savings for people on €40,000 will be €409.
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