Taxation of Paternity Benefit

Paternity Benefit is currently set at €235 per week (as Maternity Benefit), this will increase by €5 a week from the end of March 2018 as announced in Budget 2018.

Paternity Benefit is subject to PAYE, but is not liable to USC or PRSI.   

Similar to Maternity Benefit, Revenue tax Paternity Benefit through the reduction of the individual's tax credits and cut off points.

If the employee receives the benefit payment, it does not go through the payroll. If the employer receives the benefit to pass on to the employee, it should be processed as a non-taxable addition.

Please note, it is extremely important that employers import/apply the new Tax Credit Certificate/P2C file immediately upon receipt.

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