The Freelancer’s Guide to Taxes in Ireland –– Your 1st Year

Irish freelancing natives and residents alike step into a unique world of both boss and accountant.

Why taxes matter for Irish freelancers specifically

Unlike employees who have PAYE handled for them, freelancers must calculate, declare and pay their own taxes. This can get cumbersome, but more often the administrative side is simply a hassle. Thankfully there’s ways to deter that admin burden and ensure you remain compliant (and get the most out of every return).

Today we’ll walk you through:

• What taxes freelancers in Ireland must pay
• How self-assessment and preliminary tax works
• Filing deadlines and payment methods
• Common mistakes to avoid in your first year
• Tools like Xolo Go that simplify bookkeeping and tax prep
  
  

If you’re still figuring out where to start on your Irish freelancing journey, read Our Beginner’s Guide to Becoming a Freelancer in Ireland.

What taxes do Freelancers in Ireland pay?

There are some common threads in Irish tax law that apply to self-employed persons, freelancers. Knowing the basics is a great starting point for ensuring you are on time and up-to-snuff when you start your bookkeeping and get ready to file.

Income Tax

Income tax is charged on your profits (minus any allowable expenses you might claim). The standard rates are pretty cut-and-dry:

• Standard rate: 20% up to €42,000 (single person, 2025 thresholds)
• Higher rate: 40% on earnings above €42,000.
  
  

Universal Social Charge (USC)

This USC tax is applied to your gross income before any expenses come out. Rates vary a bit more here, based on different income levels. As of 2025, they are:

• 0.5% on income up to €12,012
• 2% on €12,013 – €25,760
• 4.5% on €25,761 – €70,044
• 8% on income above €70,044
  
  

PRSI (Pay Related Social Insurance)

Social insurance is a backbone for Ireland and its people. The tax contributes to state pensions and specific benefits enjoyed by those living within Ireland’s borders. 

Self-employed persons pay a Class S PRSI with a flat rate applied of 4% of all income (once you earn more than €5,000).

❗Always calculate your total tax liability as Income Tax + USC + PRSI. Many new freelancers underestimate USC and PRSI.

Self-assessment & Form 11: How they work

Freelancers in Ireland must use the self-assessment system. The process isn’t tricky, and just requires 3 quick steps to complete:

1. Register as a self-employed person with Revenue (using ROS — the Revenue Online Service)
   
   
2. Keep records of income and expenses throughout the year
   
   
3. Complete Form 11 annually to declare income, expenses and any taxes due.

This process is fairly standard in nature, but there is a key date you’ll want to keep in mind! 

31 of October each year is for paper or online filling via ROS (File Form 11 and pay taxes due for the previous year). Preliminary taxes (for the current year) are also due on this date.

What is the preliminary tax in Ireland?

Preliminary tax is a payment on account of your current year’s tax bill.

You must pay at least 90% of your current year’s liability or 100% of last year’s. If you underpay, Revenue will begin to charge interest –– that’s a spot you don’t want to be in. Keeping yourself accountable will prohibit any unnecessary extra costs.

📊 Example:

1. You earned €30,000 in 2024 and your tax liability was €5,000.
   
   
2. In 2025, you expect to earn €40,000.
   
   
3. Preliminary tax due in October 2025 = at least €4,500 (90% of €5,000) or €5,000 (100% of last year).
   
   

💡 This is where many freelancers get caught out as they don’t plan ahead for preliminary tax.

Allowable expenses for freelancers

You can deduct business-related costs before calculating your taxable profit. There’s a plethora of things that the government deems deductible, such as:

• Office supplies and software
• Professional fees (accountant, legal)
• Marketing and website costs
• A portion of home office costs (electricity, broadband)
• Travel costs (to client meetings, not daily commute)

There are many things not allowed for deduction as well: personal living costs, daily commuting, clothes (unless protective). It’s important to know ahead of time what you can claim, but most things are fairly logical as they relate directly to your business.

Filing & paying your taxes as a freelancer in Ireland

There are many services designed to help your journey, especially when it comes to accounting and tax filing (even locally). 

If you’re keen to handle your own books, then you’ll definitely want to be sure and:

1. Keep records of all invoices and expenses.
   
   
2. Log into ROS (Revenue Online Service).
   
   
3. Complete Form 11 online with your income and expense details.
   
   
4. Calculate and pay your liability (Income Tax + USC + PRSI).
   
   
5. Pay preliminary tax for the following year.
   
   

Deadlines are no joke, so keep October 31 in your head all year long! It doesn’t have to be a spooky day, as long as you know it’s coming.

💡 Why do it alone? If you’re not sure how to track it all, Xolo Go automatically records invoices and expenses so you’re always ready for tax deadlines.

Tax calculation examples for Freelancers based in Ireland

From varying income levels, to special scenarios and unique deductions, every tax filling is destined to differ from freelancer to freelancer. 

We’ve outlined some basic examples of what you might see for both €30K and €60K annual income earners.

Case 1: €30,000 income (after expenses)

• Income tax @20% = €6,000
• USC = approx. €720
• PRSI = €1,200
• Total tax: €7,920 (~26% effective rate)
  

Case 2: €60,000 income (after expenses)

• First €42,000 @20% = €8,400
• Remaining €18,000 @40% = €7,200
• USC = approx. €2,200
• PRSI = €2,400
• Total tax: €20,200 (~33% effective rate)
  

Common mistakes Freelancers make (every single year)

It’s easy to forget the bureaucratic admin side of your job when you’re neck deep in the work you love doing. Don’t forget that there are services designed to assist you every step of the way, to relieve some of that burden. 

But if you’re wanting to go it alone, be sure you don’t tumble into these pitfalls:

• ❌ Not setting aside money for tax throughout the year
• ❌ Forgetting preliminary tax
• ❌ Claiming non-allowable expenses
• ❌ Filing late → penalties + interest
• ❌ Mixing personal and business income in the same account

Your freelance life will be a rewarding one when there’s no penalties and undue stress involved from something like filling taxes. 

Xolo helps freelancers in Ireland stay on top of their taxes

💡 With Xolo Go you can manage your taxes and freelancing workflow — from invoicing to expense tracking — while staying compliant with Revenue requirements.

Take the stress out of your first tax year and every year after it! Start invoicing and tracking with Xolo today.