Apr 2014
24
Taxation of Illness Benefit - Notification Letters
Illness Benefit & Occupational Injury Benefit paid by the Department of Social Protection (DSP) to PAYE workers is to be included by employers with taxable pay.
DSP notifies employers of the taxable amount of Illness/Occupational Benefit and of any changes to the amounts. In the past these notification letters have been posted to employers. With effect from 14th April 2014 DSP are using Revenue’s ROS Inbox facility to deliver notification letters directly to ROS registered employers. This change helps to ensure that employers are in a position to calculate the correct amount of tax payable.
Illness & Occupational Injury Benefit continue to be exempt from USC and PRSI.
All queries relating to the payments should be directed to DSP.
Full details regarding the taxation of Illness & Occupational Benefit can be found in The Employer’s Guide to PAYE.
Help on entering Illness/Occupational Injury Benefit can be found in the Online Help for Thesaurus Payroll Manager and BrightPay.
Mar 2014
21
Windows XP support to end – Time to upgrade?
As of the 8th of April 2014 Microsoft will cease support of the Windows XP OS (Operating System). Originally launched in 2001 it has been Microsoft’s most successful operating system. They tried to convince people to upgrade to Windows Vista in 2005 but many had upgraded to XP service pack 2 around the same time so didn’t want to incur extra cost or the hassle of having to change their OS.
What does support ending mean?
It means there will be no more upgrades. Patch Tuesday (the day of the week Microsoft release their updates and patches) will be no more. It means that XP machines will no longer receive security patches, meaning they will face greater risks of targeted hacking attacks.
It also means that when companies such as Thesaurus Software and banks update the security certificates (which are renewed every few years) for their websites, XP users will not receive these new patches from Microsoft. Therefore, when users visit these sites they will get security warnings, or could be blocked by their computer altogether.
When should you upgrade?
Like with windows 95, 98 and 2000, your existing programs will continue to work as normal, your computer will not suddenly stop working just because Microsoft stops supporting it! However as technology moves on XP will become eventually obsolete. Couple that with the fact that as a machine gets older it inevitably slows down and becomes less reliable. So while there is no major rush to go out and buy new machines a plan should be put in place to upgrade your systems in the near future.
Will my payroll program still work on XP?
Both Thesaurus Payroll Manager and BrightPay will continue to work on XP and they will continue to work for the foreseeable future. We at Thesaurus will continue to support our programs and assist customers who use XP. However as Thesaurus and other companies update their digital certificates some XP users may experience difficulties using certain aspects of the program (Creating bank files, upgrades etc).
Feb 2014
28
Payroll Tip - February 2014
• The easiest way for employers to communicate with Revenue is via ROS (Revenue On-Line Service). If you are not already registered for ROS, information is available at http://www.ros.ie/PublisherServlet/info/setupnewcust. One benefit is that employers get extra time to file returns and make payments which can be beneficial.
• When a new employee starts employment, it is important that the employer registers them with Revenue as soon as possible.
• If it is the employee’s first employment in Ireland, you should ensure the employee has a PPSN (Personal Public Service Number). If the employee does not have a PPSN, the employee should apply for a PPSN through the Department of Social Protection. Once the PPSN is received, a Form 12A should be completed and sent to Revenue to apply for a Certificate of Tax Credits and Standard Rate Cut-Off Point.
• If a new employee gives you a P45 from a previous employer, you should register the employee by uploading the P45 Part 3 to ROS. The P45 Part 3 for uploading to ROS can be created using Thesaurus Payroll Manager or BrightPay.
• If a new employee hasn’t come from previous employment you should register the employee by uploading a P46 to ROS. The P46 for uploading to ROS can be created using Thesaurus Payroll Manager or BrightPay.
• If an employee has a second job, they should contact Revenue directly so that their allowances can be split between the two employments.
Feb 2014
20
Revenue gives deadline of 31st March for property tax, household charge compliance
The Revenue Commissioners are to give individuals who have not paid the property tax or household charge until the end of March to comply with the levies.
The tax authority said there is now a six-week window for people to pay the outstanding amounts before interest and penalties will apply.
People who have undervalued their property or claimed an exemption which they are not entitled to also have to regularise their position by 31 March.
Revenue says it will begin its compliance campaign from the beginning of April.
People who have not complied by 31 March will have interest back dated to 1 July 2013. It will charge tax of 8% per annum.
"Penalties will apply to those who seriously do not comply with us," said the Revenue's project manager Vivienne Dempsey.
She added that 460,000 properties had not paid the household charge. Some of these may be entitled to an exemption.
However, 242,000 properties have workers in the properties who will now be subject to mandatory deductions from their pay at source.
If you have not yet paid your LPT, you can contact Revenue at 1890 200 255 to arrange to do so. If you undervalued your property, you can self-correct this valuation and pay the additional liability by March 31st by using its online service.
Feb 2014
14
What might be coming down the tracks for Irish employers
Here is an article that recently appeared in the online version of Business & Finance and that should be of interest to all Irish employers.
http://businessandfinance.com/whats-coming-down-the-track-for-irish-employers/?ref
Jan 2014
28
Payroll Tax Tip – January 2014
Employers don’t miss your P35 deadline!!!!
The deadline for the 2013 P35 is 15th of February 2014. The extended date for ROS customers who pay & file on line is 23rd February 2014.
Important Points:
- All persons in your employment during the tax year, including those who left, must be included on the P35
- Where an employee’s PPS number is not known, it is important to include the employee’s address and date of birth
- Care should be taken to ensure PPS numbers are correct
- Only one entry should be made for each employee
There are severe penalties for failure to lodge end of year returns within the time provided. A delay in lodging the P35 return may cause employees unnecessary difficulty and delay when claiming Social Welfare benefits.
Form P60s
Between 1st of January and 15th of February, employers must give their employees a P60, showing Total Pay, Tax and PRSI contributions etc for the year ended 31st of December.
All employees in your employment on 31st of December should be provided with a P60. If an employee ceases employment on 31st December they should be given a form P45 and a form P60.
Revenue no longer issue P60 stationery, employers can print P60s for their employees from Thesaurus Payroll Manager/BrightPay onto blank stationery.
P35 FAQs can be found on Revenue’s website
Jan 2014
22
Will Ireland ever follow the UK lead and adopt auto enrolment?
Thankfully, we are living longer! This, however, presents a huge challenge for any country’s retirement strategy. Back in 1950, there were 7.2 people aged 20–64 for every person of 65 or over in the OECD countries. This is projected to reduce to 1.8 by 2050. The math is stark. To fund a state pension which pays modern day equivalents to people retiring at 65 will soon become an impossible task. Apart from increasing the already huge tax burden to pay for pensions, there are really only two ways of addressing the problem. One, the retirement age needs to increase and, two, people will need to have private pensions or other incomes to supplement their state pension.
Auto Enrolment addresses the latter. It imposes a legal obligation on employers to enrol their employees in pension schemes and to contribute to these pensions. A deduction is made from the employee’s pay plus the employer contributes as well. Auto Enrolment began in the UK for very large employers in 2012 and is being rolled out to include all employers by 2017. The combined minimum deduction and contribution of 2% is designed to ease employees and employers into the concept but this combined level rises to 8% by 2018.
It should be noted that employee participation is optional. The employer must enrol them but they may subsequently opt out. Therefore, employees who feel that they are otherwise covered (e.g. through rental property and/or other investments) do not have to partake in Auto Enrolment.
The various rules surrounding Auto Enrolment and the structures that need to be put in place are numerous and represent a major undertaking for government, employers and pension companies.
Auto Enrolment (or similar) is an absolute necessity and it is somewhat surprising that Irish plans in this regard are not more advanced.
Jan 2014
20
SEPA Deadline extended 6 months
The European Commission has issued a six-month grace period with regard to the upcoming Single Euro Payments Area system, beyond the Feb 1 deadline.
While it technically remains in place, the update means firms not in full compliance by the start of next month won’t suffer from their payments systems being automatically shut down and leaving them unable to pay staff or suppliers.
SEPA is being introduced by the commission to improve domestic and cross-border payment efficiency within the EU. Until a few days ago, non-compliant firms were facing a countdown to their credit transfers and direct debt facilities ceasing to function.
“An efficient single market needs an efficient SEPA. The entire payments chain — consumers, banks, and businesses — will benefit from SEPA and its cheaper and faster payments,” said Michel Barnier, the internal market and services commissioner.
“Cross-border payments are no longer exceptional events which is why an efficient cross-border regime is needed.”
He noted that migration rates for credit transfers and direct debits are not yet high enough to ensure a smooth transition to SEPA by the beginning of next month. He stressed that while existing payment systems will be accepted for another six months, the start of February remains the preferred migration deadline.
“I have warned, many times, that migration was happening too slowly and call once more on member states to fully assume their responsibilities and accelerate and intensify efforts to migrate to SEPA so that all can enjoy its benefits. The transition period will not be extended after August,” he added.
A recent survey by ISME showed that only 22% of small firms in Ireland were SEPA-compliant in the run-up to the end of 2013.
Jan 2014
8
BrightPay campaign to support “Fix Crumlin Children’s Hospital”
Click to purchase and we donate!
For every 2014 BrightPay license sold for just €149 (pus Vat) BrightPay will make a €10 donation to help fix the children’s wards at Crumlin Children’s Hospital.
Dec 2013
29
Payroll Tax Tip - December 2013
Tax Relief for Medical Expenses
Employees don’t forget to claim tax relief on medical expenses!!!!
Time Limit
A claim for tax relief must be made within 4 years after the end of the tax year to which the claim relates. Therefore to claim for 2009 you must submit your claim by the 31st of December 2013.
General Information
Tax Relief may be claimed in respect of certain medical expenses paid by you.
You cannot claim tax relief for any expenditure which:
- has been or will be reimbursed by another body such as VHI, Laya Healthcare, Hibernian Aviva Health, the Health Service Executive or any other body or person
- has been or will be the subject of a compensation payment
- relates to routine dental and ophthalmic care
You may claim relief in respect of any qualifying expenses paid by you in respect of any individual.
Tax Rate
Relief is allowed at the standard rate of tax (20%) with the exception of nursing home expenditure which is allowed at the higher tax rate (41%), if applicable.
Methods of Claiming
- online via Revenue’s PAYE Anytime Service
- completing Form Med 1 and submitting it to your local Revenue Office
- if you use a Form 11 to make a tax return enter the amount of health expenses claim at Panel 1
If the claim includes non routine dental expenses you must obtain a form Med 2, this must be signed and certified by the dental practitioner.
There is no need to send receipts backing up the claim but you need to retain all receipts for a period of 6 years as the claim may be selected for detailed examination in the future.
Full details can be found on Revenue’s website
http://www.revenue.ie/en/tax/it/leaflets/it6.html#section1
