Overtime Tax (FSS OT)
From 2022 onwards, Qualifying Overtime for full-time employees can now be taxed at 15% for the first €10,000 of overtime. This is defaulted for employees who fit the requirements, but any employee may decide to exclude their overtime income from such method (See: LN 245 of 2020.)
Employment Requirements for Eligibility
For an employee to be eligible for the Overtime Tax, the following requirements must be met:
- Employee's basic salary is less than €375 per week or €19,500 per year
- Employee is registered as a full-time employee
- Employee is not in a managerial post
Opting Out of Overtime Tax on Buddy
If an employee ticks Section E in the FS4 (i.e., they would like to opt out of the Overtime Tax Rate at 15%) OR if they are in a managerial post, you need to opt out of the overtime tax.
In such cases, edit the Employee Salary Details and tick the checkbox for OT Tax Opt Out. These employees will have their overtime taxed at their main tax rate instead.