Sep 2022
28
Budget 2023 - An employer focus
On 27th of September 2022, Minister for Finance, Paschal Donohoe, and Minister for Public Expenditure and Reform, Michael McGrath, presented the 2023 budget. Minister McGrath called the budget a “Cost of Living Budget”, and said it was focused on helping individuals, families and businesses deal with rising prices.
Below, we've listed some of the measures from the budget which will most affect employers.
Income Tax
There are no change to tax rates for 2023, the standard rate will remain at 20% and the higher rate at 40%.
• The Standard Rate Cut Off Point (SRCOP) has been increased by €3,200 from €36,800 to €40,000
• The Personal Tax Credit increased by €75 from €1,700 to €1,775
• The Employee Tax Credit increased by €75 from €1,700 to €1,775
• The Earned Income Credit increased by €75 from €1,700 to €1,775
• The Home Carer’s Tax Credit will increase by €100
Universal Social Charge (USC)
• Exemption threshold remains at €13,000
• There are no changes to the rates of USC
• The 2% USC rate band has increased by €1,625, from €21,295 to €22,920
USC Rates & Bands 2023
• €0 – €12,012 @ 0.5%
• €12,013 – €22,920@ 2%
• €22,921 – €70,044 @ 4.5%
• €70,045 + @ 8%
Medical card holders and individuals aged 70 years and older whose aggregate income does not exceed €60,000 will continue to pay a maximum rate of 2%.
The emergency rate of USC remains at 8%.
Non-PAYE income in excess of €100,000 will continue to be subject to USC at 11%.
Rent Tax Credit
Any taxpayer that are renting a property and are not receiving housing supports will qualify for a rent tax credit of €500 per annum. In the case of married couples or civil partners this credit will be doubled. This will come into effect in 2023 but can be claimed for rent paid in 2022 in early 2023.
Tax Relief for Remote Workers
The tax relief for remote workers remains unchanged at claiming relief of to 30% of the cost of vouched expenses for heat, electricity and broadband in respect of those days spent working from home.
Small Benefit Exemption
The Small Benefit Exemption has been increased from €500 to €1,000, with employers permitted to give employees two vouchers per year, as opposed to one voucher which was permitted to date. This applies for 2022 and years following.
ASC
There are no changes to the ASC rates for 2023.
National Minimum Wage
The National Minimum Wage will increase by 80 cent from €10.50 to €11.30 per hour from 1st January 2023.
Pay Related Social Insurance (PRSI)
Due to the increase in the minimum wage on 1st January 2023 the upper threshold for paying the 8.8% Class A rate of employer PRSI is being increased from €410 to €441 from the 1st January 2023. There is no change to the PRSI credit.
VAT
The reduced rate of 9% VAT for the tourism and hospitality sector and electricity and gas bills will continue to apply until the 28th February 2023. 0% rate of Vat is introduced in respect of newspapers and news periodicals, including digital editions, defibrillators, hormone replacement and nicotine replacement therapies, and certain period products from 1st January 2023.
Social Welfare Payments
There will be a €12 increase to core weekly Social Welfare payments with effect from January 2023. The maximum personal rate of Illness Benefit will be increased to € per week. Maternity/Paternity/Adoptive /Parent’s Benefit will increase to €262 per week from 1st January 2023.
Related articles:
- What’s the craic with Statutory Sick Pay in Ireland?
- BrightPay Customer Update: October 2022
- Employee paid sick leave: What you need to know
Sep 2022
27
BrightPay Customer Update: October 2022
Welcome to BrightPay's October update. Our most important news this month includes
-
What you need to know about Statutory Sick Pay
-
New living wage to replace minimum wage by 2026
-
5 reasons to choose Surf Accounts Production
Webinar: Statutory Sick Pay
Join us for our free upcoming webinar on everything to do with Statutory Sick Pay. During the webinar, we will explore how this new legislation will affect us all, and we will discuss the new responsibilities that are associated with it.
Speed up the process of signing documents
Getting your clients' documents signed can be a difficult task. Surf Accounts Production offers an inbuilt electronic signing feature, allowing you to send documents digitally, track the signature's status, and download a fully signed version of the document.
In action: BrightPay's integration with Surf Accounts
BrightPay and Surf Accounts have teamed up, making it easier to keep your payroll and accounting systems aligned. Our seamless integration allows you to save time, reduce errors and create cost efficiencies. Book your place now to avoid disappointment.
Time management tips for accountants in practice
It's tax season and managing your time effectively is critical for meeting deadlines and growing your practice. In Surf’s new free guide, learn essential tips that can help you to improve your time management and save you money.
4 ways to boost your payroll profits
By using the right technology, payroll can be a profit machine for your practice. In this guide, discover how you can save time on tedious admin work, and boost the speed and security of your payroll processes today.
Skyrocket your payroll processing speed in the cloud
In this free guide, learn how your business can cut the time it takes to distribute payslips, manage annual leave and back up your payroll data. Managing payroll and HR tasks has never been more seamless.
What you need to know about Statutory Sick Pay in Ireland
From 2023, paid sick leave is being phased in over a four-year period across the country – but what does this mean for you? We cover all the essential information you need to know in our latest blog post.
Sep 2022
13
What’s the craic with Statutory Sick Pay in Ireland?
The year is 2021, the month is June. Olivia Rodrigo’s “Cool 4 U” is number one in the charts, we are still in the midst of a nationwide lockdown. You’re in bed sick, sipping flat 7-Up and your job doesn’t offer statutory sick pay. Things are looking bleak. But suddenly, your ears prick at an announcement on the news saying that the government plans on bringing in a national Statutory Sick Pay (SSP) scheme. A ray of light shines in the window.
Fast forward to today and you’re back in the office, lockdown is in the distant past and the Sick Leave Act 2022 has become law and will come into force early next year. Ireland was one of the only advanced economies in Europe without mandatory sick leave entitlement so this is excellent news. Before, sick leave was at the discretion of the employer.
From January next year, SSP is being phased in over a four-year period starting with three days payable per year in 2023, rising to five days payable in 2024, seven days payable in 2025 and eventually, by 2026, employees will cover the cost of 10 sick days per year. The phased introduction is to allow employers to prepare and budget for the scheme and its associated cost.
So what do employers have to do? The SSP will be paid at the rate of 70% of the employee’s wage, subject to a daily threshold of €110. The eventual 10 days, or two working weeks, will be in addition to other leave, as well as public holidays.
There are some caveats however. Employees will have to provide a medical certificate to qualify for SSP and will need to have been employed by the employer for a minimum of six months before they can claim SSP. The leave must also be in relation to a day or days when an employee would usually work but is unable to due to illness or injury. The leave can also be taken as consecutive or non-consecutive days.
“And how will this affect employers” I hear you ask? Well, if you don’t already have a sick leave scheme in place at your company the new legislation may impose costs onto you. These include administrative costs in relation to setting up and implementing the scheme, along with maintaining records.
In the records you are required to keep information on:
- The employees’ period of employment
- The dates of statutory sick leave in respect of each employee
- The rate of statutory sick leave payment in relation to each employee
Employers may also wish to update their template contracts for new hires to include that contractual sick pay is inclusive of any applicable SSP entitlement. It is also important that you examine existing policies and contracts to make sure they comply with the minimum statutory entitlement under the SSP scheme when it comes into effect. Or, if you use employee contract software like Bright Contracts, this information will be automatically updated for you.
If you already have a sick pay scheme in your company and the existing provision is as favourable or more favourable than the statutory provision, you’re good to go and no changes are needed. It’s only when the existing provision in your standard entitlement employment contract is less favourable than the statutory provision that you will then have some work to do to bring it up to speed.
So there you have it! It might seem like a bit of a headache (no pun intended) but in the long run the scheme will benefit both employers and employees alike. You don’t have to deal with Margaret coming into work and coughing all over you, spreading germs. Plus, employees will feel more protected and valued when they can recover in the safety of their own bed with a hot water bottle and a good ol’ Netflix subscription.
Written by Aoibheann Byrne | BrightPay Payroll Software
Related articles:
- BrightPay Customer Update: September 2022
- Living wage to replace minimum wage in Ireland by 2026
- Draft letters with ease thanks to our new documentation feature
