Deductible expenses: office costs, travel, equipment, professional fees, etc.
Default: €1,775 Personal + €1,775 Earned Income Credit = €3,550
Annual Take-Home Pay
€49,045.38
Key information for self-employed contractors in Ireland
What taxes do Irish contractors pay?
Self-employed contractors in Ireland pay three main taxes: Income Tax (20% standard rate, 40% higher rate), PRSI (Class S at 4%), and USC (Universal Social Charge at tiered rates). These are paid through the self-assessment system and the annual Form 11 return filed with Revenue.
Earned Income Tax Credit
Self-employed individuals are entitled to the Earned Income Tax Credit of €1,775 (2025), in addition to the Personal Tax Credit of €1,775. Together these provide €3,550 in credits that reduce your income tax bill.
Preliminary Tax
Contractors must pay preliminary tax by 31 October each year (extended to mid-November for ROS filers). This is at least 100% of your prior year liability or 90% of your current year liability. Late payments attract interest of 0.0219% per day.
Revenue Aligned: Based on 2025 Irish tax rates and credits. This calculator provides estimates only. For complex situations including VAT registration, pension contributions, or company formation, consult a qualified tax adviser.
How self-employed contractors are taxed through the self-assessment system
What taxes do contractors pay in Ireland?
Self-employed contractors pay three main taxes: Income Tax at 20% on the first €42,000 (single person) and 40% above that, PRSI Class S at 4% of all income, and USC (Universal Social Charge) at tiered rates from 0.5% to 8%. On €60,000 profit, you would pay roughly €15,200 in total tax, leaving about €44,800 take-home.
What tax credits can contractors claim?
Every self-employed person gets the Personal Tax Credit of €1,875 and the Earned Income Tax Credit of €1,875. Together these reduce your tax bill by €3,750. You may also qualify for other credits like the Home Carer Credit (€1,800) or Single Person Child Carer Credit (€1,750) depending on your situation.
What is preliminary tax and when is it due?
Preliminary tax is an advance payment towards your current year tax bill. You must pay at least 100% of your previous year’s tax or 90% of your current year’s liability, whichever you choose. The deadline is 31 October each year, or mid-November if you file through ROS (Revenue Online Service). Late payment attracts interest of 0.0219% per day.
What business expenses can contractors deduct?
You can deduct any expense that is wholly and exclusively for business use. Common deductions include office rent, equipment, insurance, accountancy fees, travel to client sites, phone and internet costs, and professional subscriptions. If you work from home, you can claim a portion of heating, electricity, and broadband based on the rooms used.
Do I need to register for VAT as a contractor?
If your annual turnover from services exceeds €42,500, you must register for VAT. The standard VAT rate in Ireland is 23%. Once registered, you charge VAT on your invoices and file VAT returns (usually every two months). You can reclaim VAT on business purchases. You can also register voluntarily below the threshold if it benefits you.
How do I file my tax return?
Contractors file a Form 11 through Revenue’s online system (ROS). The deadline is 31 October for paper returns or mid-November for online filing. You report your total income, deduct allowable expenses, and calculate your tax liability. Many contractors hire an accountant, which typically costs €500 to €1,500 per year.
Should I set up a company instead of being a sole trader?
It depends on your profit level. Sole traders pay up to 55% marginal tax (40% income tax + 4% PRSI + 8% USC + 3% surcharge). A company pays 12.5% corporation tax on trading profits. But extracting money from the company via salary or dividends creates extra tax. Generally, profits above €100,000 make a company worth considering, but get professional advice.
What is the difference between a contractor and an employee?
Revenue looks at several factors: do you control how and when you work? Do you provide your own tools? Can you hire a substitute? Do you work for multiple clients? If you answer yes to these, you are likely a genuine contractor. If your client controls your hours, provides equipment, and you only work for them, Revenue may reclassify you as an employee, which means the client owes employer PRSI.
Revenue-Aligned: Based on 2025 Revenue rates and thresholds. For personal advice, speak to a qualified tax adviser.
Related Calculators
Disclaimer: This calculator provides estimates based on current HMRC rates and thresholds for the 2025/26 tax year. It does not constitute professional tax, financial, or legal advice. Your actual liability may differ depending on your individual circumstances. Always consult a qualified accountant or tax adviser before making financial decisions. Read our terms