Is retro pay taxed in Ireland?
In many payroll setups, retro pay is treated as taxable pay when it is paid. It can be charged PAYE, USC and PRSI depending on your circumstances and payroll settings.
Why does retro pay look heavily taxed on one payslip?
Retro pay is often paid as a lump sum. That can push the period into higher marginal PAYE and USC bands, and PRSI can also apply depending on PRSI class.
How can I estimate the take-home amount?
Model a base scenario and a scenario with the additional income and compare the change in net pay. Use annual view for budgeting and treat results as estimates.