USC does NOT apply to:

• A. PAYE income
• B. deposit interest
• C. self-employed income
• D. earned income in excess of €12,012

Answer: (D)

Universal Social Charge is a tax on gross income that applies across most income sources, with a zero or low band up to a threshold and higher rates on the portion above that threshold. Wages paid under PAYE, self‑employed earnings, and deposit interest are all subject to USC. The key point is that the first part of income up to a certain annual amount is not charged at USC, and the portion above that threshold is taxed at the applicable USC rates. So the idea that USC does not apply to earned income in excess of €12,012 isn’t accurate because it’s the portion above that threshold that is subject to USC at the relevant rates. In short, USC applies to the types listed, with the threshold determining how much of the income is taxed.