Reviewed by: MyTaxRebate Team on 5 Mar 2026 | Authority: s.472 TCA 1997
Quick Answer
When you have two PAYE jobs in Ireland, Revenue's default allocation assigns your full standard rate band and tax credits - including the Employee Tax Credit (€1,875 under s.472 TCA 1997) - to the primary employment. The secondary employment is then taxed at 40% from the first euro with no credits. If your combined income from both jobs is below the standard rate threshold (approximately €42,000 for a single person in 2025), your secondary employment income is being overtaxed. The excess 40% deductions are recoverable through a the Revenue system review for each year they occurred. You can also request Revenue to split the standard rate band and credits between both employers going forward to prevent the overpayment from recurring.
What This Page Covers
- ✓How second income is taxed under the PAYE system
- ✓The standard rate band: how Revenue allocates it between employers
- ✓Why secondary employment is often taxed at 40% when it should be 20%
- ✓How to request a rate band split between two employers
- ✓How to claim back overpaid tax on secondary employment
- ✓Self-employed second income: how it differs from PAYE
Key Facts at a Glance
- ✓Standard rate band (single person, 2025): approximately €42,000 taxed at 20%.
- ✓Employee Tax Credit: €1,875 /year (s.472 TCA 1997) - allocated to primary employer by default.
- ✓Secondary employment: taxed at 40% by default with no credits - recoverable if combined income is below standard rate band.
- ✓Fix going forward: request a rate band split in the Revenue system under "Jobs and Pensions".
- ✓Claim back: submit review the tax position for each of the four open years (2022 - 2025) to recover past overpayments.
How Revenue Allocates the Standard Rate Band and Credits
Under Ireland's PAYE system, Revenue issues each employer a tax credit certificate that specifies the worker's credits and the portion of the standard rate band allocated to that employment. By default, Revenue allocates the full standard rate band (€42,000 for a single person in 2025) and all tax credits to the primary employment - identified as the employment with the highest income. The secondary employer receives a €0 cut-off, meaning their payroll deducts 40% on all income paid to the worker with no credits. This is the correct treatment if the worker's primary income already fully uses the standard rate band - but it results in an overpayment where the combined income is within the band.
For example: a single worker earns €28,000 at their primary job and €14,000 at a second job. Their combined income is €42,000, exactly at the standard rate band. All of that income should be taxed at 20%. But the secondary employer deducts 40% on the €14,000 secondary income (€5,600 tax) instead of 20% (€2,800). The €2,800 excess is an overpayment, refundable through a year-end the Revenue system review.
How to Request a Rate Band Split Between Two Employers
To prevent ongoing overpayment on secondary employment, request Revenue to split the standard rate band between your two employers. Log into the Revenue system and navigate to "Manage My Tax Credits - Jobs and Pensions". Select your two employments and allocate the standard rate band between them based on your expected income from each. Revenue will issue revised tax credit certificates to each employer, and from the date of the revised certificate, both employers deduct tax at the correct rate on their respective share of your income.
The split does not apply retroactively - it takes effect from the date Revenue issues the revised certificates. Overpayments from weeks before the split was applied must still be recovered through a year-end the Revenue system review. This is why it is important to both fix the ongoing allocation AND review all four open years to recover any historical overpayments from years before the split was in place.
Claiming Back Overpaid Tax on Secondary Employment
For each year in which secondary employment income was taxed at 40% where it should have been at 20%, a PAYE overpayment exists. To claim this back, submit a review the tax position through the Revenue system for each relevant year. Revenue recalculates the correct position across all employers for the year - combining income from both jobs, applying the correct standard rate band, and recalculating the correct tax due. The difference between the tax correctly due and the tax actually deducted is issued as a refund. All four open years (2022 - 2025) can be reviewed in a single the Revenue system session.
Check Your Claim
MyTaxRebate can review your position and guide the next step.
Self-Employed Second Income: Different Rules Apply
Workers who have a PAYE job and also earn self-employed income (freelance work, consultancy, rental income) are in a different position. Self-employed income is reported through an annual self-assessed return (Form 11) rather than through the PAYE review route. The Employee Tax Credit under s.472 TCA 1997 applies only to PAYE income and cannot be used against self-employment income. Preliminary tax on self-employment income must be paid by 31 October each year. If you have both PAYE and self-employed income and are unsure how they interact, consulting a registered tax agent ensures the correct treatment of each income stream.
How to Avoid Overpaying Tax on a Second Job
The most effective way to prevent overpaying on a second income is to contact Revenue and request that the standard rate band is split between the two employers in proportion to expected income from each. This is done through the Revenue system under "Manage My Tax Credits", where you can allocate a portion of the cut-off point to the secondary employer. Revenue then issues revised credit certificates to both employers, and the secondary employer deducts tax at the correct rate from the first payslip after the update.
Where the band split is not done prospectively and the secondary employer has been taxing all income at 40%, the year-end the Revenue system review recalculates the correct position across both employers. The review applies the standard rate band as if it had been correctly split, determines the correct annual tax liability on the combined income, and issues a refund for the difference between the tax deducted and the tax actually due. The Employee Tax Credit (€1,875 under s.472 TCA 1997) and Personal Tax Credit (€1,875) are both applied in the recalculation.
USC and PRSI on a Second Income
In addition to income tax, a second income is subject to Universal Social Charge (USC) and PRSI. USC is applied to each employment separately at the rate applicable to that income stream - there is no band-splitting mechanism for USC between employers. A worker with two incomes above €13,000 combined will pay the higher USC rate on the secondary income from the first euro. There is generally no overpayment of USC in this scenario, as USC does not use a credit system in the same way as income tax. PRSI Class A contributions at 4% apply to all employment income and are deducted at source from both employments.
For workers with a primary PAYE job and a secondary self-employed income (rather than a second PAYE job), the tax treatment differs significantly. Self-employed income above €5,000 must be declared through an annual Form 11 self-assessed return by 31 October. PAYE credits continue to apply to the PAYE income, but the self-employed income is assessed separately. Workers in this mixed position should ensure they are registered for self-assessment if their non-PAYE income exceeds €5,000, as failure to file can result in surcharges and interest charges from Revenue.
For workers with two PAYE jobs who have been paying excess income tax in prior years, all four open years (2022 - 2025) can be reviewed simultaneously through the Revenue system. The combined review across all open years generates the full refund entitlement from all years in a single submission. MyTaxRebate handles the complete review across all four years and submits a consolidated PAYE claim.
Check Your Claim
MyTaxRebate can review your position and guide the next step.
Tax Scenarios
Employee with missing credits
A PAYE worker finishes the year with standard credits not fully reflected in payroll. The corrected annual calculation reduces liability by €940, creating a refund once the file is reviewed properly.
Worker who changed jobs
An employee changes employer twice in one year and payroll deductions do not align neatly across the record. A full review shows €780 of overpaid tax after the final year-end reconciliation.
Part-year worker with reliefs still unused
A worker has employment income for only part of the year and also has allowable reliefs that were never fully used. The combined review produces a refund of about €1,120 rather than a smaller payslip-only correction.
Common Mistakes To Avoid
- ✗Not requesting a rate band split when starting a second job - causes ongoing 40% deduction on secondary income that accumulates into a large year-end overpayment.
- ✗Assuming the overpayment will be corrected automatically - Revenue does not issue automatic refunds; a the Revenue system review must be submitted for each year.
- ✗Confusing PAYE second-job income with self-employed income - self-employment is assessed differently through the annual self-assessed return system.
- ✗Not reviewing all four open years - the overpayment from incorrect secondary tax often spans multiple years and each requires a separate review.
- ✗Not realising that the standard rate band needs to be actively split between employers - Revenue does not do this automatically, and failing to split it means the secondary income is taxed at 40% regardless of total combined income.
When This Does Not Apply
Key Takeaways
- Secondary employment is taxed at 40% by default - request a rate band split in the Revenue system to correct this going forward.
- The Employee Tax Credit (€1,875, s.472 TCA 1997) is allocated to the primary employer only by default.
- Where combined income is below €42,000, secondary employment has been overtaxed at 40% when 20% was the correct rate - this is recoverable for all four open years.
- MyTaxRebate reviews secondary employment overpayments across all four open years as part of the comprehensive PAYE review at no upfront cost.
Check Your Claim
MyTaxRebate can review your position and guide the next step.
Frequently Asked Questions
Why is my second job taxed at 40%?
Revenue's default allocation assigns all tax credits and the standard rate band to the primary employer. The secondary employer therefore has no credits and no standard rate band, resulting in 40% deductions on all secondary income.
How do I split my tax rate band between two jobs?
Log into the Revenue system, go to Manage My Tax Credits - Jobs and Pensions, and allocate the standard rate band between your two employers. Revenue issues revised certificates and both employers deduct at the correct rates going forward.
Can I get back the overpaid tax on my second job?
Yes. Submit a review the tax position for each relevant year in the Revenue system. Revenue recalculates across all employers for the year and refunds any overpayment. All four open years (2022 - 2025) can be reviewed.
What is the standard rate band in 2025?
Approximately €42,000 for a single person in 2025. Income up to this threshold is taxed at 20%. Income above is taxed at 40%.
Does self-employment income get taxed the same way as a PAYE second job?
No. Self-employment income is assessed through the annual self-assessed return (Form 11) rather than PAYE. Different rules and deadlines apply, and the Employee Tax Credit does not apply to self-employment income.
How far back can I claim for secondary employment overpayments?
Four years. In 2025: 2022, 2023, 2024, and 2025. Each year where secondary employment was taxed at 40% instead of 20% (due to no rate band split) can be reviewed and refunded through the Revenue system.
