Tax Paying in Ireland 2000-2004
Distribution of PAYE & Self-Employed Earners

The Department of Finance published the following data in respect of the period 2000-2004, prior to Budget 2005:

  • Percentage of tax payers in higher rate bracket;

  • Distribution of PAYE income earners by ranges of income;

  • Distribution of self-employed income earners by ranges of income ;

  • Cost of special incentive tax breaks for high earners;  

  • Sector Information for Annual Earnings of €200,000+

  • Capital Acquisition Tax Data 1994-2003

Tax Year   Higher Rate
  Number of Taxpayers %
2000/01 540,000 30.6%
2001+ 535,000 29.9%
2002* 487,000 26.7%
2003* 555,000 29.8%
2004* 614,000 32.6%

+ Short tax “year” from 6 April 2001 to 31 December 2001.

* Provisional and subject to revision.

It should be noted that a married couple who has elected or has been deemed to have elected for joint assessment is counted as one tax unit. The numbers of income earners above have been rounded to the nearest thousand as appropriate.

Almost 10% of the self-employed will earn over €100,000 in 2004 compared with less than 3% of PAYE workers, according to the data from the Department of Finance. The figures also show that the majority of people earn less than €30,000 after a decade of the Celtic Tiger- 60% of PAYE earners compared with 52% of the self-employed. 

Some 45,000 PAYE earners (less than 3%) will earn over €100,000 this year. However, 21,000 self-employed individuals (10% of the total) will earn more than €100,000.

In the short tax year of 2001 (Apr-Dec) lawyers headed the rankings-794 individuals- of earning in excess of €200,000 annually, followed by medical consultants/doctors.

For the tax years 2000/01 and 2001, the numbers of income earners at all income levels in the tables below are best estimates based on data from completed end of year returns but adjusted to take account of returns which had not been received when the data were compiled. For later years, the numbers of earners in the various ranges of income are based on the adjusted data for 2001 projected forward in accordance with macroeconomic data relating to actual and expected growth in wages and employment.

Distribution of PAYE income earners on tax records, 
including tax exempt individuals, by ranges of income

Range of Gross Inc €

2000/01

2001

2002

2003

2004

€1 - €10,000

429,680

489,670

346,900

332,390

317,430

€10,001 - €20,000

406,470

493,650

384,440

367,670

351,600

€20,001 - €30,000

293,150

280,920

323,890

331,360

332,590

€30,001 - €40,000

168,440

147,740

206,760

218,290

226,310

€40,001 - €50,000

102,870

73,870

132,080

144,490

154,000

€50,001 - €60,000

55,150

38,240

79,530

90,280

98,990

€60,001 - €70,000

32,290

21,190

47,550

55,240

62,220

€70,001 - €80,000

21,320

11,650

29,560

34,630

39,070

€80,001 - €100,000

20,330

10,820

30,990

37,100

42,670

€100,001 - €125,000

10,070

5,710

14,430

17,830

21,170

€125,001 - €150,000

5,910

2,950

6,400

7,630

8,810

€150,001 - €200,000

4,590

2,590

5,560

6,510

7,490

Over €200,000

5,740

2,890

5,710

6,470

7,260

Note: The numbers of income earners in each income range above have been estimated to the nearest ten as appropriate.

 Distribution of self-employed income earners on tax records
including tax exempt individuals, by ranges of income

Range of Gross Income €

2000/01

2001

2002

2003

2004

€1 - €10,000

45,520

56,730

37,920

34,460

32,820

€10,001 - €20,000

55,110

58,880

47,340

43,760

41,850

€20,001 - €30,000

38,480

34,080

37,560

37,470

37,660

€30,001 - €40,000

22,600

19,600

24,400

25,680

26,540

€40,001 - €50,000

12,150

11,030

16,460

17,810

18,610

€50,001 - €60,000

7,880

6,780

10,880

12,110

13,040

€60,001 - €70,000

4,880

4,350

7,260

8,290

8,950

€70,001 - €80,000

3,890

2,930

5,180

5,950

6,400

€80,001 - €100,000

4,850

3,750

6,410

7,380

8,260

€100,001 - €125,000

4,540

2,740

4,490

5,170

5,720

€125,001 - €150,000

2,000

1,720

2,760

3,190

3,430

€150,001 - €200,000

2,900

1,960

3,230

3,680

3,940

Over €200,000

4,210

3,540

6,090

7,040

7,750

Note:The numbers of income earners in each income range above have been estimated to the nearest ten as appropriate.  

Cost of Tax Breaks for High Earners

The Revenue has revealed that it estimates that tax breaks available to high earners are costing €8.3bn each year. The figures relate to 28 generous relief schemes provided by the Government including investments in hotels and holiday homes. However, the Revenue has not provided estimates of the cost of a further 33 tax breaks, including the exemption for stallion fees, donations to third level institutions and income from foreign trusts.

In October, it was revealed that 41 single and married people with incomes in excess of €500,000, paid no tax in 2001. Eleven of the 41 declared incomes of over €1m for tax purposes, and yet had a zero liability to tax.

On November 10, 2004, Frank Daly, Chairman of the Revenue Commissioners told an Oireachtas committee that up to 40 Irish individuals who claim to be domiciled abroad for tax purposes, are being monitored. Zero contributions are made to the cost of public services despite frequent visits here. Each is worth more than 50 million. Daly said that a further 250 individuals who are in the super-rich league are being monitored. 

Tax exiles must remain outside the country for 183 days in a year. However, a day spent in Ireland does not count as a day, if the individual has left the jurisdiction before midnight e.g. via the convenience provided by a private jet.

Irish tax rates are amongst the lowest in Europe.

Click for Current Irish Taxation Rates

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Sector Information for Annual Earnings of €200,000+

The latest relevant sector-based information available on employees taxed under the PAYE system and self-employed persons taxed under the self-assessment system is derived from income tax returns filed for the income tax “year” 2001. It is not possible at present to provide the information sought for a more recent year if the data are to be reasonably accurate.

It should be noted that as PAYE taxpayers were charged to tax on their earnings in the period from 6 April to 31 December 2001 and self-employed taxpayers were assessed to tax for the short “year” on 74% of the profits earned in a 12 month accounting period, the numbers of cases with gross income exceeding €200,000 per annum may not be directly comparable with those of earlier or later years. The sector identifier used on the tax records is based on the four digit “NACE code (Rev. 1)” which is an internationally recognised economic activity code system.

Gross income exceeding €200,000 by NACE Economic Activity Code, 2001

 

Employees

Sector (economic activity code)

Numbers of income earners with gross income exceeding €200,000

Cases where no sector is identified (9991)

756

Letting of own property (70.20)

336

Medical practice activities (85.12)

136

Architectural and engineering activities and related technical consultancy (74.20)

50

Development and selling of real estate (70.11)

43

Farming (190)

41

Business and management consultancy activities (74.14)

40

Other business activities (74.87)

34

Accounting book-keeping and auditing activities; tax consultancy (74.12)

33

General construction of buildings and civil engineering works (45.21)

32

 

Self Employed

Sector (economic activity code)

Numbers of income earners with gross income exceeding €200,000

Legal activities (74.11)

794

Medical practice activities (85.12)

346

Cases where no sector identified (9991)

313

Accounting, book-keeping and auditing activities; tax consultancy (74.12)

280

Letting of own property (70.20)

170

Hospital activities (85.11)

144

Architectural and engineering activities and related technical consultancy (74.20)

118

Farming (190)

79

Dental practice activities (85.13)

70

Reproduction of computer media (22.33)

54

Employees’ and 'Self Employed' are classified for this purpose according to their main source of income.

The NACE codes are not essential for the assessment and collection of taxes and duties and the correct allocation and maintenance of these codes is subject to the limit of available resources. The economic sector breakdown on Revenue records is based on details which were recorded using information supplied by income earners or their employers at some point in the past. Some of that information may have been incorrect or misinterpreted in the first instance, or may not have been subsequently updated as necessary. For these reasons some of the economic sector codes on tax records are likely to be out of date or inaccurate and the reliability of the figures for the sectors currently provided will be limited to that extent.

A married couple who has elected or who has been deemed to have elected for joint assessment is counted as one tax unit and their incomes are aggregated in the statistics.  

Capital Acquisition Tax 1993-2004 

Year Total CAT Yield €million Inheritance Tax as a Percentage
    %
1994 74.8 71
1995 75.6 67
1996 103.5 59
1997 112.6 72
1998 141.8 69
1999 192.3 70
2000 222.9 69
2001 167.7 72
2002 150.9 85
2003 213.2 61

The total CAT yield comprises inheritance tax, gift tax, discretionary trust tax and probate tax, although it should be noted that probate tax was abolished in respect of deaths occurring on or after 6 December 2000.

 

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