The Paternity Leave and Benefit Act 2016 introduced statutory paternity leave of 2 weeks, together with a new Paternity Benefit in respect of births and adoptions on or after 1 September 2016.
Paternity Benefit is currently set at €235 per week (as Maternity Benefit), this will increase by €5 a week from the end of March 2018 as announced in Budget 2018.
Paternity Benefit is subject to PAYE, but is not liable to USC or PRSI.
Similar to Maternity Benefit, Revenue will tax Paternity Benefit by reducing an employee's tax credits and rate bands. Employers will be advised of the adjusted tax credits and cut off points on employer Tax Credit Certificates (P2Cs). Therefore, it is important that employers import/apply the new tax credits and standard rate cut off points immediately upon receipt.
If the employee receives the benefit payment, it does not go through the payroll. If the employer receives the benefit to pass on to the employee, it should be processed as a non-taxable addition.
Need help? Support is available at 01 8352074 or [email protected].