The Universal Social Charge (USC) was introduced in the December budget and came into effect on the 1st of January this year. The new USC charge is a tax “payable on gross income, including notional pay, after any relief for certain capital allowances, but before pension contributions”. All individuals are liable to pay the Universal Social Charge if their gross income exceeds the threshold of €4,004 p.a. (€77 per week).
On the 25th January Minister Lenihan announced that the Government had decided to amend the Finance Bill 2011 so that Medical Card holders will only pay a 4% USC on all income above €10,036. A 2% USC will apply up to the €10,036 threshold.
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