Jun 2014
4
Changes to Holiday Pay Calculations
As we enter the summer holiday season employers need to ensure that they are paying their employees correctly during annual leave.
A recent decision by the European Court of Justice (ECJ) will impact how some annual leave pay is calculated.
Do you pay employee’s commission? Is the commission calculated based on the amount of sales made or actual work carried out? If yes, according to the ECJ, holiday pay should include commission pay.
The decision was made in the case of Locke v British Gas Trading and Others. Locke was a Sales Representative whose commission made up approximately 60% of his remuneration. After taking two weeks leave in 2011, Locke suffered financially as he was unable to generate sales for the period he was on annual leave.
The ECJ ruled that the purpose of annual leave is to allow a worker to enjoy a period of rest and relaxation with sufficient pay. By not including commission payments with holiday pay, employees are less likely to take annual leave so as to avoid financial hardship.
It has been left to the national courts to determine how to calculate the commission to which a worker is entitled, however the court did suggest that taking an average amount of commission earned over a certain period, e.g. the previous 12 months.
Employers are advised to review their commission policies to establish which, if any, payments need to be included in annual leave pay.
May 2014
22
USC - Increase for medical card holders?
The removal of a ‘concession’ to medical card holders earning under €60,000 by which they did not have to pay the 7% rate of Universal Social Charge (USC) is scheduled to hit in January 2015. The move will affect full medical card holders earning more than €16,016 and less than €60,000. Currently full medical card holders with earnings under €60,000 are exempt from the 7% rate of USC; the 4% rate applies to all income over €10,036. It is estimated that this measure will affect approximately 360,000 taxpayers. On a salary of €40,000 the increase would be in excess of €700.
If the Government does not reconsider, this will coincide with the demands for the first Water Tax payment and comes shortly after the introduction of Local Property Tax (LPT). The Finance Minister Michael Noonan says that when the levy was implemented by Fianna Fail under the so-called sunset clause, the lower rate was set to expire in January 2015 but that does not mean it can’t be extended in the same way as the 9% rate of VAT was last year.
It has also been revealed that the 10% rate of USC for those self employed earning in excess of €100,000 will be reduced to 7% which is a significant cut for high earners.
Budget 2015 in October will reveal all!!!
May 2014
1
Eircodes - the new postcodes for Ireland
Every address in Ireland will receive its unique Eircode in Spring 2015.
"The Eircodes will help the public, businesses and public bodies to locate every individual address in the State. Eircodes will bring many benefits to the daily lives of people, householders and businesses. Currently, around 35% of addresses - mainly in rural areas - do not have a unique name or number in their address. With Eircodes, delivery of services and goods will be much easier and quicker to these addresses." - www.eircode.ie
When people receive their Eircode next year, they will not need to change their address. They will just add the Eircode whenever it is needed or useful, so it will be very easy to start using it straight away.
Each Eircode has seven-characters that are unique to each mailing address. The seven characters are divided into two parts – a Routing Key and a Unique Identifier.
For businesses, some of the main things to consider are:
- Stationery, customer forms, websites and other places where your address is shown. Perhaps, plan print stocks of existing stationery items accordingly in the run up to Eircode Launch Date in Spring 2015.
- If you use a software package in your business, you will need to check with its supplier as to their plans for when and how they intend to incorporate Eircodes into the package.
- Some staff training may be needed especially if your systems or processes have changed somewhat to take advantage of Eircodes.
Our software offerings will all be updated to include an extra address field for eircodes and will incorporate all the required validation logic.
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).
Mar 2014
12
Google Maps – Local Property Tax (LPT)
The Revenue Commissioners has announced a system for checking to see if people have deliberately undervalued their homes to reduce their Local Property Tax (LPT) below what they should be paying. Officials will use a system that is based on Google Street View and Google Maps to highlight properties where home owners have reduced the value significantly below their neighbours. "If we find properties like this we will look at it and see if we should challenge it," said Revenue's economist Keith Walsh.
Only officials working with Revenue will have access to the maps and the public will have no access. The maps will show the average value of homes sold on any street and the values other homes owners have attributed to their own properties. It will also show the identity of the homeowners, their PPS number and whether they have paid the LPT and household charge. "If people think they have undervalued they will have an opportunity to correct the value online," Mr. Walsh said. If property owners correct the value before 31st March 2014, they can avoid interest and penalties.
Revenue expects to write to people who have deliberately undervalued their home next month.
Mar 2014
10
Fathers to get chance to share two weeks of maternity leave
New mothers would be able to gift two weeks of their maternity leave to their child’s father under legislation being considered by the government. Kathleen Lynch minister of state at the Department of Justice said it is “actively” working on proposals to allow fathers to share some of the statutory 26 weeks leave given to mothers. Another option being considered is allowing parents to “step in and out” of the 26 weeks leave, to allow them to share the time more equally. “We hope to have serious proposals prepared before end of 2014” says Lynch. – “in terms of the bill itself, we would be ensuring the power to decide on the parental leave is always vested in the mother.
The Justice Department has had discussions with interested parties such as employer’s representatives, women’s groups, and other government departments. She said many people had expressed concerns at the implications of introducing paternity leave, such as the cost for employers and reduction of maternity leave for women.
Children’s Minister, Frances Fitzgerald said she was in favour of increasing maternity leave to 52 weeks over a five year period. She also wants fathers to share in this leave. This would bring Ireland in line with Britain. There a woman is entitled to 52 weeks’ maternity leave while the father gets up to two weeks leave when the child is born and can also share up to 26 weeks of the mother’s leave when she returns to work. A Paternity Leave bill is before the Seanad at the moment.
Mar 2014
6
Compliance Code for Irish PAYE Taxpayers
Revenue published a new Compliance Code for PAYE Taxpayers. This new Code describes Revenue’s PAYE compliance programme and the nature and scope of PAYE compliance interventions. This Code is effective from 18 November 2013 and all PAYE compliance interventions undertaken by Revenue will be made under the terms of this Code.
The Code can be downloaded here.
Mar 2014
5
ROS Digital Certificate Expiry Notice
ROS Certificates issued by Revenue normally have a two-year validity, after which time customers must renew the Certificate to retain access to ROS.
However, as part of its ongoing security measures, Revenue updated the ROS Certificate Authority on 13th January 2014 and all Certificates issued by the old Authority will now expire on 27th March 2014.
From February 24th/25th 2014, customers will be presented with the Certificate Renewal screen when they login to ROS. Customers should renew their Certificate when presented with this opportunity to ensure continued access to ROS. Step by step instructions are provided and this procedure will take less than 2 minutes to complete. The digital certificate renewal process applies to all digital certificates.
WebServices Users:
If you are using a ROS Certificate within an application, then it is important that you plan to renew this Certificate before 27th March. As there is no option to renew from within your application, you will need to login to ROS with that Certificate in order to complete the renewal and then replace the old Certificate used by your application.
Mar 2014
3
How to Roll out Contracts & Handbooks to Existing Staff
Introducing a contract of employment or a handbook for the first time to current employees, can be a difficult, tricky matter for many employers.
It is an area that many employers put on the long finger, or avoid doing until they have to.
Common reasons for not implementing employee documentation include:
• Lack of time
• Fear that employees will refute the terms of the documents and refuse to sign
• Anxiety that documentation will harm the relationship between management and staff, if the employees feel a new set of rules are being entrust upon then
• A false belief that it will restrict how management deal with employees
However, this does not have to be the case. It is possible to introduce new documentation without spending huge amounts of time, alienating your work force, or causing disruption.
The answer lies in good communications.
To help employers introduce employee documentation, we’ve created a short video outlining our four step guide to rolling out contracts and handbooks.
Alternatively, read our guide to Introducing Contracts & Handbooks to Existing Staff available here http://www.brightcontracts.ie/docs/introducing-contracts-handbooks-to-existing-staff/
