Seán Kenny (Dublin North East, Labour)
Link to this: Individually | In context

Question 64: To ask the Minister for Finance when the 2011 budget changes for deducting the universal social charge from medical cardholders will be implemented and when refunds due will issue. [10028/11]

Michael Noonan (Limerick City, Fine Gael)
Link to this: Individually | In context

The universal social charge (USC) was introduced with effect from 1 January 2011. There is an exempt annual threshold of €4,004 (€77 per week). However, where this threshold is exceeded, the entire amount is chargeable. The standard rates of charge are:

- 2% on the first €10,036,

- 4% on the next €5,980, and

- 7% on the balance.

As the Deputy is aware, the Finance Act 2011 introduced a concession which applies from 1 January 2011 for individuals in possession of a medical card or a Health Amendment Act card. Accordingly, the maximum rate of charge of USC for individuals in receipt of employment/pension income and in possession of a full medical card or a Health Amendment Act card is 4% irrespective of the level of their income.

Employers and payroll operators have been advised by Revenue that where an employee or pensioner makes them aware that he or she is the holder of a full medical card or a Health Amendment Act card the employer should immediately apply the lower rate of USC to salary or pension payments already made in respect of the period since 1 January and to make a repayment of any overpayment of USC at the earliest possible date.

Where an employee does not make the employer or payroll operator aware of the fact that he or she has a medical or Health Amendment Act card during the year, Revenue will, on receipt of an appropriate claim after the end of the tax year, process the repayment arising in a timely manner.

A comprehensive publication of "Frequently Asked Questions" (FAQs) in relation to the USC has been posted on the Revenue website and is updated at regular intervals. These FAQs are intended to guide employers and payroll operators in addressing all issues related to the operation of USC.