## Who qualifies
The reduced USC rate is available to:
- Holders of a full medical card (not the GP visit card)
- With annual income of €60,000 or less
- For periods during which the medical card is held
The reduced rate applies only to income above €27,382. Income below that level uses the standard 0.5 percent and 2 percent rates as for everyone else.
## How the cap works
| Band | Standard rate | Reduced rate |
| --- | --- | --- |
| Up to €12,012 | 0.5 percent | 0.5 percent |
| €12,012.01 to €27,382 | 2 percent | 2 percent |
| Above €27,382 | 4 percent | 2 percent |
| Above €70,044 | 8 percent | 2 percent |
In effect, the third and fourth bands collapse to a 2 percent cap.
## Worked example
Padraig holds a full medical card and earns €40,000 in 2026.
Standard USC:
- 0.5 percent on €12,012 = €60.06
- 2 percent on €15,370 = €307.40
- 4 percent on €12,618 = €504.72
- Total: €872.18
Reduced USC:
- 0.5 percent on €12,012 = €60.06
- 2 percent on €15,370 = €307.40
- 2 percent on €12,618 = €252.36
- Total: €619.82
Saving: €252.36 per year.
## Income test detail
The €60,000 test uses:
- Total annual income (gross, before tax)
- All sources combined: PAYE, pensions, self employed
- Calendar year basis
If income exceeds €60,000, the reduced rate is lost for the entire year, not just the excess.
## How to claim
1. Notify Revenue through myAccount that you hold a medical card
2. Provide the card number and validity period
3. Revenue updates your RPN to apply the reduced rate
4. Your employer's payroll automatically caps USC at 2 percent
If you applied late, claim a refund through the Statement of Liability after year end.
## When the medical card lapses
If your card is renewed without break the reduced rate continues. If it lapses, USC reverts to standard rates from the lapse date forward. Revenue typically pro rates the year.
## Educational notice
This article describes general rules. Eligibility and rate detail can change. Confirm current rules on Revenue.ie or with a tax adviser.