Calculate Relevant Contracts Tax deductions instantly. Find out your net payment as a subcontractor with ease.
CALCULATOR DETAILS
Calculation Summary
Labour Amount
0.00
Gross minus Materials
RCT Deduction
0.00
Tax Deduction
Net Payment
0.00
To Subcontractor
The Relevant Contracts Tax (RCT) is a tax withholding system operated by Revenue Commissioners that applies to the construction industry. It requires contractors to deduct tax from payments made to subcontractors. The amount deducted depends on whether the subcontractor is registered for RCT and their status. This scheme applies to all payments for construction services, including labour and materials.
Applies when the subcontractor has a valid RCT registration with Revenue Commissioners and a valid Unique Taxpayer Reference (UTR). This is the standard rate for registered subcontractors.
Applies when the subcontractor is not registered for RCT or does not have valid registration documentation. This is a higher rate to protect Revenue Commissioners revenue.
Applies to subcontractors who have been given Gross Payment Status by Revenue Commissioners. These are typically larger, more established companies with excellent compliance records. No deduction is required.
Contractors must register for RCT if they:
Subcontractor registration is optional but recommended to:
RCT and VAT Reverse Charge are separate rules that both apply to construction services in Ireland. Here's how they differ:
| Aspect | RCT | VAT Reverse Charge |
|---|---|---|
| Purpose | Tax withholding on labour | VAT liability transfer |
| Applies to | Construction labour | Qualifying construction supplies |
| Who collects | Contractor withholds | Customer pays direct to Revenue Commissioners |
| Can coexist | Yes, both rules can apply simultaneously to the same invoice | |
The Relevant Contracts Tax (RCT) is a tax withholding system used in the construction industry. Contractors are required to deduct tax from payments made to subcontractors. The deduction rate depends on the subcontractor's registration status: 20% for registered, 30% for unregistered, or 0% for those with gross payment status.
Registering for RCT as a subcontractor is optional but highly recommended. By registering, you reduce the RCT deduction from 30% to 20%, saving you money on every payment. You also improve your credibility with contractors and simplify your tax reporting. The registration is free and can be completed online through Revenue Commissioners.
RCT registration with Revenue Commissioners can take 4-8 weeks. During this time, the 30% deduction rate still applies. Once you receive your registration confirmation and UTR number, you can provide these to contractors and the 23% rate will apply to future payments.
RCT deductions are treated as advance tax payments and can be claimed back against your tax liability through self-assessment. If you have overpaid or have insufficient tax liability, you can claim a refund from Revenue Commissioners.
Gross Payment Status is granted by Revenue Commissioners to large, well-established subcontractors with excellent compliance records. It exempts them from RCT deductions entirely, allowing them to receive the full gross payment. This status is not available to most small businesses and requires specific criteria to be met.