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Methods of calculating tax

Week 1 basis

Note

The information on this page refers to your current obligations. For your obligations before 1 January 2019, please see the Employers Guide to PAYE.

The Week 1 basis is also known as 'non-cumulative basis' or Month 1 basis for employees paid monthly.

You tax each pay day on its own, separate from previous weeks. Pay and tax credits are not accumulated from the previous 1 January.

  • Example

    Ann is your employee. You receive a Revenue Payroll Notification (RPN) for Ann showing these tax credits and cut-off point:

    Ann's tax credit and cut-off point details
    DescriptionAmount per yearAmount per week
    Total tax credits €4,000 €76.92
    Cut-off point €44,000 €846.16

    The RPN indicates that you should tax Ann on a Week 1 basis.

    Ann earns different amounts of pay each week. In week 1, she earned €400; in week 2 she earned €850; and in week 3 she earned €250. Here is how you calculate her tax each week:

    Week 1
    DescriptionAmount
    Pay this week €400
    Tax full pay of €400 at 20% €80.00
    Less weekly tax credit €76.92
    Tax to deduct for week 1 €3.08
    Week 2
    DescriptionAmount
    Pay this week €850
    Tax weekly income to cut-off point (€846.16) at 20% €169.23
    Tax €3.84 (€850 - €846.16) at 40% €1.54
    Gross tax €170.77
    Less weekly tax credit €76.92
    Tax to deduct for week 2 €93.85
    Week 3
    DescriptionAmount
    Pay this week €250
    Tax full pay of €250 at 20% €50.00
    Less weekly tax credit €76.92
    Tax to deduct for week 3 €0.00

    In week 3 you do not refund any tax to Ann, even though she has not used all of her tax credit for that week. This is because she is on a week 1 basis.

When to use Week 1 basis

You use a Week 1 basis to calculate an employee's tax if their RPN instructs you to use it.

Next: Emergency basis

Published: 01 January 2025 Print this page

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