The countdown to PAYE Modernisation is in full swing with the new real time system set to go live from 1st January 2019, 10 months from now! With P60s for 2017 having been issued to employees and P35s for 2017 having been filed with Revenue, you may be happy to hear that 2018 will be the last year in respect of which you will have to issue P60s and file a P35 return!
For tax year 2019: P30s, P35s, P45s, P46s, and P60s will be abolished.
In 2019, employers will be required to request a Revenue Payroll Notification (RPN) from Revenue before paying employees. An RPN will be the new name for a P2C and will contain the necessary information to deduct tax, USC and LPT from employees. The first request for an RPN for a new employee will also register the employment with Revenue. The use of the Emergency Basis of tax will be limited to those employees for whom an RPN is not available.
Employers will be required to submit payroll information (e.g. pay and statutory deductions, pay date, cessation date, etc.) to Revenue in an Employer Payroll Submission on or before the day the employee is paid.
The employer will receive a monthly statement from Revenue at the end of each calendar month indicating the total liabilities (or refunds) of tax, USC, PRSI and LPT in respect of all the payrolls processed in that calendar month under that employer registration number. If any of the details are incorrect, the employer will be required to correct the statement and submit the corrections to Revenue before the return due date. The statement will automatically become the return on the return due date.
In all cases (i.e. for monthly and quarterly filers) the return due date will be the 14th of the following month. While the return due date is the 14th of the following month, the payment date will be extended to the 23rd of the following month (or 23 days following the end of each quarter) where it is paid and filed online.
Note: Quarterly remitters will be required to submit an employer payroll submission on or before the day the employee is paid, file monthly returns, but the payment will remain on a quarterly basis.
Employers can start to take steps now to ensure that they are ready for PAYE modernisation. One of the most important things for employers to do is to make sure that they have the correct PPS number for each employee and to ensure that each employment is registered with Revenue (i.e. does the employer hold a current P2C for each employee?).
Where the employee is commencing employment for the first time in the State, the onus is on the individual to register his employment online using the Jobs and Pensions service in MyAccount, which will result in a P2C being issued to the employer. Employers should provide such employees with their employer registration number, start date, pay frequency and staff number if applicable.