On 1st January 2019, the modernisation of the Irish PAYE system came into effect. The objective of PAYE Modernisation is that Revenue, employers and employees have access to the most accurate, up to date information relating to employee pay and statutory payroll deductions. If you are a PAYE contract employee are you aware of the changes and how you need to prepare?
A real-time reporting (RTR) payroll system was introduced. Employers receive electronic Revenue updates on employee’s tax credits, cut-off points and current year prior employment information (if relevant) in advance of each payroll. Employers electronically report pay and statutory payroll deductions for each employee to Revenue at the end of each payroll.
This has resulted in Revenue abolishing the P45 (statement of taxable pay /deductions year to date when you leave an employer) and the P60 (statement of taxable pay/deductions at the end of the calendar year) along with other employer reporting obligations for 2019. Another key change is that the payroll payment date (and not the earnings period) determines the month/year when a payroll payment is assessed for statutory payroll deductions.
Are you prepared?
Revenue recommends individuals set up a Revenue ‘myAccount’ which is a single access point for secure online services. It is a quick, convenient and easy way to perform several tasks. These include
- Updating your personal details
- Reviewing your tax affairs
- Making payments and applying for certain tax reliefs and incentives
- Reviewing your cut-off points and tax credits and notify Revenue if changes need to be made. (This table provides some of the main tax credits)
- Notifying Revenue to register or cease your job
- Make a return
- Reviewing your pay and statutory deductions for the year (available from mid-2019)
Employers have to use the tax information Revenue send to them to process your payroll and calculate the statutory deductions and it is the employee’s responsibility to ensure the tax information (cut off point, credits etc) is correct. Revenue can be contacted on 01 7383636.
If you have any other queries regarding payroll, please do not hesitate to contact Fastnet’s Contract Solutions team who will be happy to assist you.