Taxation of DEASP payments

How tax is calculated on DEASP payments

Taxable Department of Employment Affairs and Social Protection (DEASP) payments are liable to Income Tax, but not on either: 

How the tax on social welfare payments is collected depends on whether you are either:

  • a PAYE taxpayer
  • or
  • self-employed.

If you are a PAYE taxpayer, we reduce your annual tax credits and rate band on your tax credit certificate to take account of any taxable DEASP payments.

Note

The social welfare rate increases outlined in Budget 2019 are being paid from the week commencing 25 March 2019. Further information is available on the DEASP website

These increases will be applied to your tax credits and rate band (on a Week 1 basis) from 8 April 2019. This means that if you receive an increase of €5 per week, you will additionally pay either:

- €1 per week if you pay tax at 20%

- €2 per week if you pay tax at 40%.

You may be currently exempt from income tax. If your total income continues to be less than the exemption limit, you will continue to be exempt. 

If you are self-employed, you should include details of any taxable DEASP payments on your tax return and pay the tax due when making your annual income tax payment. Please use the Revenue Online Service (ROS) to submit your tax return.

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