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Ireland – Modernising PAYE and Real Time Reporting Coming Soon

Ireland – Modernising PAYE and Real Time Reporting

This report covers a newly-published brochure entitled “PAYE Modernisation – Real Time Reporting of Payroll Taxes,” from KPMG in Ireland.

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Flash Alert 2018-106

PAYE modernisation represents the biggest change in Ireland to the administration of employment taxes since the introduction of the PAYE system in 1960.1  In simple terms, real time reporting (RTR) requires employers to submit the details of each employee’s pay to Revenue on or before each pay day.  An accurate and detailed breakdown of all pay, deductions, and tax must be disclosed in respect of each employee, effective 1 January 2019.

The KPMG International member firm in Ireland has just published a new brochure entitled “PAYE Modernisation – Real Time Reporting of Payroll Taxes,” that readers may access.  To learn more, click here.

WHY THIS MATTERS

The scale of the business process changes required should not be underestimated, particularly for companies with complex payroll structures.  For example, the frequency with which this level of information needs to be provided to Revenue will mean a major operational change in the management of payroll taxes.  

Also, it should be noted that Revenue is aware that many employers’ processes include a ‘catch up’ at year end.  This will no longer be possible under the new regime.    

Some Key Changes

  • All current forms relevant to payroll taxes (i.e., P30, P35, P60, and P45) will be abolished.  The tax details disclosed in each payroll run will be collated and a statement will be issued by Revenue, which will become the employer’s payroll tax return, replacing the P30 form.
  • Companies will have 14 days to review this statement and investigate any errors/discrepancies, before paying over the relevant tax to Revenue by the payment dates in the following month.  Tax payment dates will remain unchanged.
  • Employers are required to download the latest RPN (Revenue Payroll Notification, which is akin to the current P2C/TCC) for each employee and use the details therein to calculate the payroll taxes to be deducted.  These tax details, along with a significant number of other employee-specific remuneration data items, need to be disclosed in a PSR (Payroll Submission Request), on or before the day on which employees are paid.

KPMG NOTE

Areas that have historically been challenging to deal with from a payroll tax perspective need to be reviewed to establish whether the processes in place are appropriate and robust for purposes of managing the accurate submission of data to Revenue, for example, share-based remuneration, benefits-in-kind on company cars, inbound/outbound assignees and short-term business visitors, etc.

FOOTNOTE

1  For additional information from Revenue, click here.  

The information contained in this newsletter was submitted by the KPMG International member firm in Ireland.

© 2018 KPMG, an Irish partnership and a member firm of the KPMG network of independent member firms affiliated with KPMG International Cooperative (“KPMG International”), a Swiss entity. All rights reserved.

Flash Alert is an Global Mobility Services publication of KPMG LLPs Washington National Tax practice. The KPMG logo and name are trademarks of KPMG International. KPMG International is a Swiss cooperative that serves as a coordinating entity for a network of independent member firms. KPMG International provides no audit or other client services. Such services are provided solely by member firms in their respective geographic areas. KPMG International and its member firms are legally distinct and separate entities. They are not and nothing contained herein shall be construed to place these entities in the relationship of parents, subsidiaries, agents, partners, or joint venturers. No member firm has any authority (actual, apparent, implied or otherwise) to obligate or bind KPMG International or any member firm in any manner whatsoever. The information contained in herein is of a general nature and is not intended to address the circumstances of any particular individual or entity. Although we endeavor to provide accurate and timely information, there can be no guarantee that such information is accurate as of the date it is received or that it will continue to be accurate in the future. No one should act on such information without appropriate professional advice after a thorough examination of the particular situation.

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