Paycheck Plus - Making Payroll Easy

Revenue have advised that it will suffice for an employer to print one copy of a P60 for an employee for tax year 2011 and subsequent years. There is no requirement to print a duplicate copy. If an employee seeks a duplicate copy, employers are permitted, but not obliged, to give a duplicate copy. Employers have the option of giving employees a printed version however, it is also acceptable to give an electronic P60 to an employee once the employee has access to print it and the electronic system is secure and confidential.  The Paycheck Plus Payroll Team automatically produce the P60′s for your employees as part of your payroll outsource service but if you have any questions, just let us know and we’ll be happy to assist in Making Payroll Easy!

Employers Obligations for Public Holiday

It is important that employers understand their obligations to all employees where public holidays are concerned. Most employees are entitled to a public holiday benefit. The exception to this is part-time/casual employees who have not worked at least 40 hours in the last 5 weeks prior to the public holiday.

The public Holiday Benefit can be:

• A paid day off within a month of the public holiday
• An additional day of annual leave
• A paid day off on that day
• An additional day’s pay

If an employer doers not nominate one of these options 21 days prior to the holiday, the employee automatically receives a paid day off on the public holiday.

• Where the public holiday falls on the day an employee is not normally working, or is not scheduled to work, employees are entitled to 1/5^th of their actual weekly pay instead of the actual days leave.

• Where a public holiday falls on a Saturday or Sunday the public holiday remains on that day, i.e. it does not change to the following Monday.   The employer is still obliged to provide the employees with one of the normal public Holiday Benefits as listed above. For example this occurs in 2011 as Christmas Day (25^th December) falls on a Sunday and St Stephen’s day falls on a Monday. This means Monday the 26^th is a public holiday (St Stephen’s day) but Tuesday 27^th of December 2011 is not a public holiday. However, many employers will be exercising the alternative paid day off for Christmas Day on the  Tuesday (27^th December). Similarly, as New Year’s Day is a Public Holiday and falls on a Sunday this year, employers may pay an additional amount of one fifth of an average week, grant a paid day off on the Sunday or, if the employee does not normally work on the Sunday, an alternative day which for many people will be Monday 2nd January.

• Full time employees on sick leave during a public holiday, are entitled to time off work for the public holiday. Part-time workers on sick leave during a public holiday, are entitled to time off work for the public holiday, provided they have worked at least 40 hours in the previous five-week period.

• Employees are not entitled to public holiday benefits if they have being on sick leave for more than 26 weeks, or for more than 52 weeks due to an occupational accident.

• Employees are entitled to leave for any public holidays that occur while on maternity leave parental leave or adoptive leave.

Reward your Employees Tax Free:

Employers can provide employees with a small benefit exemption to a maximum value of €250 once in any tax year. 

 The small benefit exemption must be in non-cash form, such as a voucher or a hamper. PAYE, PRSI and Income Levy will not be applied to the benefit. The small benefit exemption cannot be paid in the form of cash, cheques etc.  The exemption does not apply to the cumulative value of a number of gifts but rather it applies to a single gift. The employer saves as they do not have to pay Employers PRSI on the benefit and they also receive a deduction for the small benefit expense e.g. the cost of gift voucher, for corporation tax purposes. So treat your employees this Christmas tax free.

Employers Tip- October 2011:  Let Paycheck Plus help you comply with your Employer Pension Obligations

Paycheck Plus now has an associate Qualified Financial Advisor who can help you, set up a pension scheme for your employees.

Contact Paycheck Plus today and we will arrange a meeting for you with our associate QFA who will advise you of the best Pension Scheme options for your employees.

All employers are required by law to provide access to a pension for all employees whether they are in full time, part-time, temporary, contract or casual employment. If there is no in-house scheme, or there are restrictions on entry, contribution amounts or benefits, then a Personal Retirement Savings Account (PRSA) must be offered by law. Failure to comply is a criminal offence and could result in a fine of up to €12,700 and/or up to 2 years imprisonment.

The employer may contribute to the PRSA if they wish, but are not obliged to do so. The employer is obliged to allow employees time to explore the PRSA in-depth and discuss their scheme with an advisor during paid working hours.

Providing a Company pension or occupational pensions scheme is a tax-efficient savings plan put in place by the employer to provide a retirement income for employees. The employee also pays less PAYE on their relevant earnings.

Help your employees to recognise the benefits available to them from Revenue as they make a contribution towards their retirement. A useful pension calculator is available at www.pensionsboard.ie

Tax Relief in respect of Tuitions fees for Third Level Education

As many students commence study at this time, it’s worth considering if you can claim tax relief on Third Level education fees for yourself or anyone for whom you pay third level fees.  Relief is available at the standard rate of tax (currently 20%) subject to a maximum limit of €7,000 for the academic year 2011- 2012.

For 2011 and subsequent years, the first €2,000 of any claim is disregarded for relief where the student is studying full time or by €1,000 where the student is studying on a part-time basis.  From this academic year, 2011 – 2012, the relief is allowable in respect of tuition fees including the Student Contribution.  Relief is not available in respect of registration, administration or examination fees or any part of the fee that is, or will be met by grants, scholarships, by an employer or so on.

Relief is available per student, per course, per academic year so if you are paying college fees for more than one student in this academic year, you may claim relief in respect of the fees paid for each person.

Further details of this tax relief is available from the Revenue Information Leaftlet IT31 and a list of approved colleges and courses is available on the Revenue Website at  http://www.revenue.ie/en/tax/it/reliefs/tuition-fees.html#section6

Relief can be claimed on individuals tax returns at the end of the tax year or during the year once fees have been paid and the relief can be granted on a tax credit certificate.  You can apply for the relief by completing the application form at http://www.revenue.ie/en/tax/it/forms/it31-form.pdf

Details of any payments received or to be received towards the fees must accompany the claim.  You should retain all receipts regarding the claim for tuition fees for a period of 6 years as they may be requested for verification at a later date.

National Payroll Week celebrates the hard work and dedicated service provided by payroll personnel such as the Payroll Team at Paycheck Plus in Ireland. It is their responsibility to guarantee accurate and timely payment of salary and wage payments for more than 1.8 million employees. The work of payroll personnel is usually taken for granted and often goes unrecognised and unrewarded, despite the fact that they play a vital role in every company. Payroll personnel in Ireland are responsible for implementing and complying with a wide range of taxation, social welfare and employment legislation and in the course of doing do, they process over 80 million payslips a year, and collecting and remitting more than Euro16 billion in income tax, PRSI contributions and levies to the Irish Revenue Commissioners each year..  To our Payroll Team here at Paycheck Plus and to all other payroll personnel we say Thank You and well done for keeping Ireland paid!

Employers PRSI rate has been halved from 8.5% to 4.25% from 2^nd July 2011.

 All employees earning less than 356 Euro per week will be eligible for the new Employers PRSI rate.

The minister announced a reduction in the employer PRSI rate from 8.5% to 4.25% to assist in job creation. This will reduce employer costs in the creation of new jobs. This new rate will apply from 2^nd July 2011 until the end of 2013. This is a welcome move which will hopefully assist businesses in these difficult times.

With school holidays on the horizon you might be considering employing school children or young people during the summer months. Be aware that under the Protection of Young Persons (Employment) Act 1996, if you are employing individuals under the age of 18 years there are certain statutory obligations in relation to hours of work, breaks, rest periods and payment of wages.   Although the minimum wage is being reversed to €8.65 per hour from 1st July 2011, the rate applicable to those under the age of 18 is less.

A number of these provisions however, do not apply in the context of employment of close family members. Where such family members are employed PAYE should be operated in the normal way, which involves applying to the tax office for a tax certificate for the individual concerned.

For more information contact our Payroll Team at info@paycheckplus.ie

Save Tax as you Save The Environment:    Employees can save on PAYE, PRSI and USC under the cycle to work scheme.

The Cycle to work scheme introduced in January 2009, allows for employers to provide a new bicycle or pedelec (bicycle equipped with an auxiliary electric motor) and associated safety equipment to employees who agree to use the bicycles to travel to work. They will be treated as a tax-exempt benefit-in-kind.

This tax exemption may only apply once in every 5-year period in respect of any one employee/director. There will be a limit of €1,000 on the amount of expenditure an employer can incur in respect of any one employee/director.

The cost must be incurred directly by the employer. It is not permitted for the employee to purchase a bicycle and then seek reimbursement from the employer.

The scheme may also be implemented via salary sacrifice arrangements, whereby an employee agrees to forego part of his or her salary to cover the costs associated with the purchase of the bicycle and associated safety equipment. Where such salary sacrifice arrangements are implemented they must be completed over a maximum period of 12 months. In such circumstances, the employee will not be liable to tax or PRSI or levies on the salary sacrificed. The maximum amount of salary that can be sacrificed is €1,000.

Are your employees due a refund for Income Levy paid in 2009 and 2010?

 Where an employee’s total gross pay for the year does not exceed €15,028 a refund may be due.

 Employees may be due a refund for Income Levy paid in 2009 and 2010. The employee can contact the Revenue directly for a refund of any income levy overpayment after year end. Just complete the form on the below link to claim any Income Levy refund due.

 http://www.revenue.ie/en/tax/income-levy/refunds.html

 Employees will find all income levy details on their Income Levy Certificates, which were issued with their P60’s at year end.

 The following employees were exempt from the income levy:

•  Employees aged 65 or older where their income did not exceed €20,000 for single individuals and €40,000 for married individuals
• Employees who’s income did not exceed the exempt amount (e.g. from 1 May 2009, €15,028)
• Full medical card holders
• Individuals that were in receipt of social welfare payments

 1st January – 30th April 2009

If an employee’s income exceeded €352 per week, € 704 per fortnight, €1,526 per month (equivalent to €18,304 per annum) the employee’s gross income was liable to the income levy at the following rates:

Liable @ 1%: €100,100 per annum

Liable @ 2%: €150,020 per annum

Liable @ 3%: Balance

1st May -31st December 2009

If an employer’s income exceeded €289 per week, €578 per fortnight, €1,253 per month (equivalent to €15,028 per annum) the employee’s gross income was liable to the income levy at the following rates:

Liable @ 2%: € €75,036 per annum

Liable @ 4%: € €99,943 per annum

Liable @ 6%: Balance