Increase in Earnings Cap for Employment Contribution Purposes

The earnings cap for Social Insurance purposes for 2021 will increase to €57,408 per annum (2020: €54,864 per annum).

It is reminded that the contributions an employer is required to make on the gross emoluments of its employees are as follows:

  • Social Insurance Fund 8.3%
  • Redundancy Fund 1.2%
  • Industrial Training Fund 0.5%
  • Social Cohesion Fund 2%
  • Holiday Fund (if not exempt *) 8%

* An employer can be granted an exemption when paid annual holidays are offered and upon certain conditions being met.

Besides the Social Cohesion Fund for which contributions are uncapped, for the rest of the funds the contributions are capped as per the above mentioned threshold.

Employees are required to contribute only to the Social Insurance Fund at the same rate as with the employers and subject to the same earnings cap.

Contributions to the various employment-related funds are tax-deductible, and the employer’s contribution is not taxable for the employee.

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