What Is PAYE?
PAYE (Pay As You Earn) is the system used by employers to deduct income tax, USC, and PRSI from your wages or salary before you are paid. Your employer uses your Revenue Payroll Notification (RPN) — issued by Revenue — to calculate the correct deductions.
Updated for 2026 Revenue rates.
Who Operates Through PAYE?
If you are an employee — full-time, part-time, or a director — you are likely on the PAYE system. Your tax credits and standard rate cut-off point are allocated to your employer so deductions are accurate from your first payslip.
Revenue Payroll Notification (RPN)
Your RPN tells your employer:
- Your tax credits (personal, employee, and any other applicable credits)
- Your standard rate cut-off point (how much income taxed at 20% before 40% applies)
- Your USC rate band
- Your PRSI class
You can view and update your RPN through myAccount on revenue.ie at any time.
Emergency Tax
If you start a new job and Revenue does not have your details, your employer may place you on emergency tax. This means:
- No tax credits applied
- Higher rate (40%) applied to all income above very low threshold
- Full USC and PRSI deducted
To avoid emergency tax, register your new job with Revenue via myAccount as soon as possible. You can claim back any overpaid emergency tax through your annual tax return or by contacting Revenue directly.
Tax Credits Available to Employees
- Personal tax credit — €2,000 for single person
- Employee tax credit — €2,000 for PAYE workers
- Home carer tax credit — up to €1,950 for married couples where one spouse cares for a dependent
- Single person child carer credit — €1,900 for qualifying single parents
- Rent tax credit — up to €1,000 (€2,000 for jointly assessed couples)
Tax Refunds
You may be due a tax refund if you:
- Were on emergency tax
- Were unemployed for part of the year
- Have allowable expenses (e.g. nursing home fees, health expenses)
- Left Ireland mid-year and are not resident for full year
You can claim a refund through myAccount by filing an income tax return — even if you are a PAYE worker with no other income. Refunds are typically processed within 5–10 working days.
End-of-Year Review
Revenue automatically reviews your tax position at year-end. If you have overpaid, Revenue issues a refund directly to your bank account. If you have underpaid, Revenue will collect the balance through reduced tax credits in the following year.
Your 2026 tax credits and bands
In 2026 every PAYE employee gets the personal tax credit of €2,000 and the employee tax credit of €2,000, plus a standard rate band of €44,000 (single person). These are delivered through your RPN, so your take-home pay is correct from your first payslip. If you are married or in a civil partnership, register for joint assessment in myAccount — it gives a band of €53,000 (one income) or up to €88,000 (two incomes) and two full sets of credits, and it is the most tax-efficient option for most couples. Parents: the single person child carer credit (€1,900) and home carer credit (€1,950) can be worth hundreds of euros — apply through myAccount.
Claiming reliefs and refunds
Use the 'Review your tax' tool in myAccount at any time to claim: medical expenses (20% relief on GP, consultant, hospital, dental and nursing-home costs for you and your dependants — including for the previous 4 tax years), the Rent Tax Credit (€1,000 single / €2,000 jointly assessed for 2024-2028), tuition fees (20% relief), and flat-rate expenses for certain occupations (e.g., nurses, electrical contractors, journalists). Refunds are paid directly to your bank account, usually within a few weeks. If you were on emergency tax at any point, the year-end balancing statement automatically refunds the overpayment — but only if you have registered your job and your credits are correct.
Emergency tax: how it works and how to fix it
Emergency tax applies when your employer has no RPN for you: tax is deducted at 40% on all earnings above a tiny threshold, with no credits applied, plus full USC and PRSI. It is not a penalty — it is a temporary default — but it can hurt. Fix it by registering your new job in myAccount (employer name, PAYE reference number and start date) as soon as you have your PPS number; your employer gets a new RPN within days and your next payslip corrects the position. Any over-deduction is repaid automatically. If you are a non-resident employee or a company director, different rules apply — check Revenue's guidance for your situation.
Action steps
- Register your job in myAccount before your first payday.
- Check your RPN in myAccount — verify your credits (personal €2,000 + employee €2,000) and band (€44,000).
- Keep receipts for medical expenses and rent and claim them in the annual return.
- If you are married, elect joint assessment — it usually saves tax.
- If your tax credits are wrong, request a review through myAccount rather than waiting for year-end.