Universal Social Charge (USC) is a tax on income. Some income is exempt from USC calculations.

This article explains which income types are exempt.

• All Department of Social Protection payments. This includes Maternity Benefit, Paternity Benefit, and state pensions
• Social welfare payments, including those received from abroad
• Payments made as part of Community Employment schemes.
• The Back to Education Allowance
• Student grants and scholarships
• Certain salary sacrifice schemes. This includes the TaxSaver Commuter Ticket Scheme and the Cycle to Work scheme
• Statutory redundancy payments
• If your employee’s yearly gross income is less than €13,000.00

 NOTE: Your employee's yearly gross income may be less than €13,000. If Revenue has not exempted the employee, you still need to deduct USC from their earnings. Revenue will refund the employee. 

For information about USC thresholds and rates, read our USC thresholds and rates article.