Youth IRS in 2025: How Does It Apply?

By André Paulos, Cooperate Legal Services, Ltd.

The Youth IRS (Tax) scheme originally emerged in 2020 with the addition of Article 12-B to the Personal Income Tax Code (CIRS). At that time, the benefit was aimed at young employees receiving their first employment income (Category A), with the goal of increasing disposable income through a lower tax burden via reduced withholding tax. Initially, this benefit applied for a three-year period only to workers aged 18 to 26 who held a Level 4 qualification or higher, earned a gross annual income of €25,075 or less, and filed their tax returns individually. The maximum exemption granted under this regime was 30%.

Following a series of amendments, the 2025 State Budget introduced significant changes through a new Youth IRS model. Notably, the age limit...continues in the PDF...