Your payslip
How a bonus is taxed
A bonus is pay. It's taxed in the pay period you get it, at your marginal rate (the rate on your next euro).
There's no separate bonus tax in Ireland. A bonus is added to the payslip it's paid in and taxed like the rest of your pay.
| Bonus | €5,000.00 |
| Income tax, USC and PRSI on it | (€2,362.03) |
| What you keep | €2,637.97 |
PAYE works on the cumulative basis: each payslip looks at your pay and credits for the whole year so far. So the tax on a bonus is worked out on your year so far, not as if you earned the bonus every month. A bonus doesn't push all your pay into a higher band. Only the part above the band is taxed more.
Paying a bonus into your pension instead, through your employer, can avoid income tax, USC and PRSI on it, within limits.
Work it out
Terms: Bonus tax · Marginal tax rate
All payslip topics · General information, not tax advice.