Earned Income Credit

The Earned Income Credit is available since 1 January 2016. It is allowed in respect of the pay that you earn. It is a separate credit to the Employee Tax Credit in that it can also be claimed by people who are self-employed.

Examples of income that qualifies for the earned income credit includes:

  • trading income (Case I and II)
  • and
  • pay earned by proprietary directors.

The credit is not available against your passive or investment income, such as:

  • rental income
  • or
  • deposit interest income.

The credit available is the lower of:

  • €1,700
  • or
  • 20% of your qualifying earned income.

To see rates for previous years, see the Tax rates, bands and reliefs charts.

You may have income that qualifies for the Employee Tax Credit and the Earned Income Tax Credit. If so, the combined value of these credits cannot exceed the maximum value of the Employee Tax Credit.

This credit cannot be transferred to your spouse or civil partner.

How to claim

Making a claim for the current year:

  • sign into myAccount
  • click the ‘Manage your tax’ link in PAYE Services
  • select ‘Claim tax credits’. 

Making a claim for a previous year: 

For 2019 and subsequent years: 

  • sign into myAccount
  • click on ‘Review your tax 2018-2021’ link in PAYE Services
  • request Statement of Liability
  • click on ‘Complete Income Tax Return’
  • in the ‘Tax Credits & Reliefs’ page, select ‘Your job’ and add it as a credit
  • complete and submit the form. 

For 2018:

  • sign into myAccount
  • click on 'Review your tax 2018-2021' link in PAYE Services
  • select the Income Tax Return for the year you wish to claim
  • In the ‘Tax Credits & Reliefs’ page, select ‘Your job’ and add it as a credit
  • complete and submit the form.

Note

The Earned Income Credit will be available to claim if you are registered as:
- a proprietary director
- a spouse or civil partner of a proprietary director
- a child of proprietary director
- being in receipt of trading profit or other foreign income.

Examples