How the scheme works

How the scheme works

How to participate in the scheme

For an Employee to participate in the scheme they must choose a Commuter Travel Ticket from the Ticket Options tab which they will use mainly for commuting purposes.

To apply for a Commuter Travel Ticket you must:

Please note that schemes ran via Ticketscheme are always ran on a Salary Sacrifice basis

Salary Sacrifice Savings are made because salary sacrifice reduces the gross salary – before any tax, PRSI or USC has been deducted – so the amount of tax, PRSI and USC paid is less than usual, Employer PRSI is also less, meaning both parties make a saving.

Sounds confusing?

Here’s an example of how the savings work during the salary sacrifice period, assuming the following:

  • Employee is paid monthly
  • Employee is a standard rate tax payer requesting an Annual Dublin Bus and LUAS travel ticket at €1,590
  • The salary sacrifice period is 12 months
  • The Employee’s monthly gross salary is €2,000.00 (€24,000 per annum)

 Here is an example of how the savings work*

 

Salary before scheme participation

Salary during scheme participation

 Monthly Gross Salary

 €2,000.00

 €2,000.00

 Ticket Value

 Gross salary sacrifice total

  

 €1,590.00

 €1,590.00

 Monthly Gross Salary Sacrifice = €1,590 /  12months (this amount appears on the  salary sacrifice agreement)

 

 €132.50

 Monthly Gross Salary after salary sacrifice

 Monthly PRSI and USC

 Monthly Income Tax

 Net Salary

 €2,000.00

 €175.00

 €400.00

 €1,425.00

 €1,867.50

 €163.41

 €373.50

 €1,330.59

 Monthly Net Salary Reduction

 €1,425 - €1,330.59 =

 €94.41

 Monthly Saving

 €132.50 - €94.41 =

 €38.09

So, because you pay less tax, PRSI and USC your NET salary reduction is less than the GROSS salary reduction, and this is how savings are achieved. In the example, the employee makes a €132.50 contribution to the employer, but it only costs the employee €94.41, resulting in a saving of €38.09 per month.


Benefits to the Employee:

  • Employees can save up to 52% on travel costs as a result of tax, PRSI and USC savings.
  • There is no longer any need to queue on a daily basis for bus or rail tickets.
  • Prepaid tickets are cheaper than paying cash so reduce the cost of travelling to work
  • Can be combined with the Cycle to Work scheme so employees can combine their travel
  • No car parking or petrol costs
  • Relax on your journey to and from work
*Figures shown are approximations and are for illustrative purposes only. This is not to be construed as tax advice. The benefits of the scheme will vary depending on individual circumstances.