Self-employed get €400 back in increased income tax credit

€550 had been promised but Minister falls short.

 

In a move to partially equalise the treatment of self-employed people versus PAYE workers, Minister Michael Noonan has increased the ‘Earned income tax credit’ by €400 in today’s Budget. This means that the self-employed and proprietary directors will be better off by €400 when they file their 2017 tax return.

For years, there have been calls to harmonise the tax system so that the self-employed would be treated equally to those in the PAYE system who benefit from a €1,650 PAYE income tax credit. Last year the new credit was finally introduced and was worth €550. The promise was that the gap would be plugged over time with a further €550 to come in today’s budget however the Minister fell short, announcing a €400 increase instead.

Given that about 17.4 per cent of the Irish workforce is self-employed, according to OECD figures for 2014, there are thousands of people across the country who will likely be disappointed by today’s measure.

Date published 11 Oct 2016

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