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Junior Cert Business Studies Income

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M¨¢ire N¨ª Thighearn¨¢in
M¨¢ire N¨ª Thighearn¨¢in

This document defines different types of income and benefits, and explains what a payslip is. It discusses regular income, additional income, and benefits-in-kind that people may receive. It also provides a sample payslip that shows gross pay, deductions, and net pay. Statutory deductions like PAYE (income tax) and PRSI (social insurance) are mandatory, while voluntary deductions can include savings and health insurance.

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Income Income is something earned (money coming into the household). The main types of income are regular income, additional income and benefits-in-kind (perks). Regular income is income that a person receives every week or month e.g. pocket money, wages, salary or unemployment benefit. Additional income is extra income a person receives occasionally e.g. overtime, Christmas bonus or interest on savings. Benefit-in-kind or ¡°perks¡± are extra benefits given by an employer. Official perks are ones that the employer knows about e.g. company car, medical insurance or travelling expenses. Unofficial perks are ones that the employer does not know about e.g. personal phone calls or pens taken home by staff. Payslip When you are employed you get a payslip. A payslip shows your name, the period you are getting paid for, gross pay, deductions and the net pay. Sample Payslip Name David Whyte Period (Week 1) 01/01/200807/01/2008 Gross Pay Deductions Basic Overtime Total PAYE PRSI Savings €600 €100 €70 0 €120 €20 €50 Net Pay VHI €1 0 €500 Gross Pay is your total income before any deductions have been taken. Gross Pay = Basic Pay + Overtime + Commission + Bonus. Net Pay is your take-home pay. Net Pay = Gross Pay ¨C Deductions. Statutory Deductions are items that must be taken away from your gross pay. They are: ? PAYE (Pay As You Earn) ¨C Income tax. The Government uses this money to run the country e.g. build hospitals & schools and pay doctors¡¯ & teachers¡¯ wages. ? PRSI (Pay Related Social Insurance) ¨C money paid towards future state paid social welfare benefits e.g. unemployment benefit, old-age pension and maternity benefit.
Non-Statutory Deductions (Voluntary Deductions) are items you choose to take away from your gross pay. Examples are: ? Savings, VHI (Voluntary Health Insurance) and Trade Union subscription. Tax Credits ¨C every person who works gets tax credits which reduce the amount of tax you have to pay. Question 1. Fill in the following information into Mary Jones¡¯ Payslip: Basic Pay €700, Overtime €100, PAYE €120, PRSI €30, Savings €50 and VHI €25. Payslip - Mary Jones Name Period (Week 1) 01/01/200807/01/2008 Mary Jones Gross Pay Deductions Basic Overtime Total PAYE PRSI Savings Net Pay VHI Question 2. Fill in the following information into Joe Soaps¡¯ Payslip: Basic Pay €600, Overtime €150, PAYE €110, PRSI €28, Trade Union €10 and VHI €25. Payslip - Joe Soap Name Period Joe Soap (Week 1) 01/01/200807/01/2008 Gross Pay Basic Overtime Deductions Trade Total PAYE PRSI Union Net Pay VHI

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Junior Cert Business Studies Income

  • 1. Income Income is something earned (money coming into the household). The main types of income are regular income, additional income and benefits-in-kind (perks). Regular income is income that a person receives every week or month e.g. pocket money, wages, salary or unemployment benefit. Additional income is extra income a person receives occasionally e.g. overtime, Christmas bonus or interest on savings. Benefit-in-kind or ¡°perks¡± are extra benefits given by an employer. Official perks are ones that the employer knows about e.g. company car, medical insurance or travelling expenses. Unofficial perks are ones that the employer does not know about e.g. personal phone calls or pens taken home by staff. Payslip When you are employed you get a payslip. A payslip shows your name, the period you are getting paid for, gross pay, deductions and the net pay. Sample Payslip Name David Whyte Period (Week 1) 01/01/200807/01/2008 Gross Pay Deductions Basic Overtime Total PAYE PRSI Savings €600 €100 €70 0 €120 €20 €50 Net Pay VHI €1 0 €500 Gross Pay is your total income before any deductions have been taken. Gross Pay = Basic Pay + Overtime + Commission + Bonus. Net Pay is your take-home pay. Net Pay = Gross Pay ¨C Deductions. Statutory Deductions are items that must be taken away from your gross pay. They are: ? PAYE (Pay As You Earn) ¨C Income tax. The Government uses this money to run the country e.g. build hospitals & schools and pay doctors¡¯ & teachers¡¯ wages. ? PRSI (Pay Related Social Insurance) ¨C money paid towards future state paid social welfare benefits e.g. unemployment benefit, old-age pension and maternity benefit.
  • 2. Non-Statutory Deductions (Voluntary Deductions) are items you choose to take away from your gross pay. Examples are: ? Savings, VHI (Voluntary Health Insurance) and Trade Union subscription. Tax Credits ¨C every person who works gets tax credits which reduce the amount of tax you have to pay. Question 1. Fill in the following information into Mary Jones¡¯ Payslip: Basic Pay €700, Overtime €100, PAYE €120, PRSI €30, Savings €50 and VHI €25. Payslip - Mary Jones Name Period (Week 1) 01/01/200807/01/2008 Mary Jones Gross Pay Deductions Basic Overtime Total PAYE PRSI Savings Net Pay VHI Question 2. Fill in the following information into Joe Soaps¡¯ Payslip: Basic Pay €600, Overtime €150, PAYE €110, PRSI €28, Trade Union €10 and VHI €25. Payslip - Joe Soap Name Period Joe Soap (Week 1) 01/01/200807/01/2008 Gross Pay Basic Overtime Deductions Trade Total PAYE PRSI Union Net Pay VHI