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Irish sole trader tax: how much should you set aside?
No one deducts tax from a sole trader's income, so it is up to you to keep it aside. Here is how to work out a sensible percentage.
What you pay on your profit
- Income tax: 20% to €44,000 (single), 40% above. Credits are €2,000 personal plus €2,000 Earned Income Credit.
- USC: 0.5% / 2% / 3% / 8% (same bands as employees), plus an extra 3% on self-employed income over €100,000. None if total income is €13,000 or less.
- Class S PRSI: 4.2% to 30 September 2026 and 4.35% from 1 October 2026, from €5,000 income, with a €650 minimum.
Worked example: €45,000 profit in 2026, single, no other income
| Income tax €9,200 − €4,000 credits | €5,200 |
| USC | €882.82 |
| Class S PRSI (≈ 4.2375% blended) | €1,906.88 |
| Total | €7,989.70 ≈ 17.8% of profit |
Once your profit goes over €44,000, each extra euro costs about 52% (40% + 8% + PRSI). So a flat 25–30% of profit is a safer set-aside for most growing sole traders, and the surplus is a nice surprise.
Preliminary tax and deadlines
Each year by 31 October (mid-November if you pay and file on ROS) you file your Form 11 for last year and pay preliminary tax for this year. To avoid interest, preliminary tax must be at least 90% of this year's liability or 100% of last year's. That is why your first year often brings a double bill.
A simple system
- Open a separate savings account just for tax.
- Every time a customer pays you, move your percentage across.
- Keep expense receipts, because allowable expenses reduce profit.
- Re-check the percentage every quarter against your real profit.
Sources
- Revenue – tax rates, bands and credits
- Revenue – USC rates and thresholds
- Revenue – self-employed PRSI (Class S)
- Revenue – preliminary tax
Figures checked 12–13 October 2026. Rules change, so always confirm with the official source.
Frequently asked questions
What percentage should an Irish sole trader set aside for tax?
About 18% covers a €45,000 profit for a single person in 2026, but 25–30% is safer if your profit is growing.
When is preliminary tax due?
By 31 October each year, with an extended date for people who pay and file on ROS. It must be at least 90% of this year's liability or 100% of last year's.
Not financial advice. These guides are general information for budgeting and planning, not financial, tax, legal or mortgage advice. Rules change and your situation is unique. Check official sources or a qualified adviser before you act.