Employers – By the end of May 2013, your employees are required to return their completed Local Property Tax (LPT) form. One of the payment options is to have their LPT deducted through payroll.
Local Property Tax (LPT) – What employers need to know
What is LPT?
Individuals will be required to pay LPT from 1st July 2013. The LPT Payable for 2013 is based on the value of the property and determined by each individual. Revenue have issued guildelines on how each property should be assess and provide a simple on-line calculator on their site at http://www.revenue.ie/lpt_reckoner/index_en.html showing the amount payable for 2013. A booklet containing details of the LPT and the various payment options has been issued to all property owners over the past few weeks.
How is LPT paid?
An individual has a number of options to pay such as:
- directly on-line to www.revenue.ie using a debit or credit card
- by Single Debit Authority through their bank in one payment on a specified date
- Cash payments though certain payment service providers
- Deduction from their wages, salaries or occupational pension
- Deduction at source from Social Welfare schemes
- Deduction at source from certain payment schemes made to farmers
- Direct Debit
If an individual opts to have their LPT liability collected by deduction from their salary/wages they complete the details of their employment on their Return.
How is LPT deducted through payroll?
Revenue will communicate to the employer how much should be deducted from employees in the P2C file (details of tax credits and cut off points) which will be sent to the employers ROS inbox in June 2013 or issued by paper copy tax credit certificates. The LPT is a new field within the P2C file which the payroll operator will use to calculate the PAYE payable.
LPT deductions commence for pay dates from 1st July 2013 and, in accordance with Revenue guidelines, the LPT amount must be deducted evenly over the remainder of the 2013 year. Where, in any pay period, there is insufficient pay to enable deduction of LPT, the balance remaining will be spread evenly over the remaining pay periods.
The LPT deduction, the amount deducted to date and the balance of LPT still to be deducted should be shown on payslips.
The LPT is then paid to the Collector General through the P30 (monthly or quarterly). P45s and P60s will also have to show the LPT amount paid by the employee.
As with all other statutory deductions, employers are obliged to deduct LPT in accordance with the P2C instruction from Revenue. If an employee has an issue, they must contact Revenue directly. The employer has no discretion in the matter! Revenue can pursue employers for any amounts you fail to deduct, charge interest on late payment and fines for non-compliance.
How can I manage this effectively?
The growing number of obligations and on-going changes to the calculation of payroll has prompted many businesses to join the growing number of companies who recognise the value of outsourcing this repetitive and back-office function. Paycheck Plus offers tailored payroll services to suit any sized business and help employers operate their payroll compliantly and effectively in the most tax efficient manner for both employers and their employees.
- PAYE, PRSI and USC calculations
- BIK calculations
- Social Welfare taxation
- Payslip printing and distribution
- Payroll reporting
- Revenue filing
- Employee payments.
They offer a range of additional services to suit individual company needs such as
- Nominal Ledger Reporting
- On-line payslips,
- Support Helpline,
- Consultancy &Training,
- Third Party payments,
- Domestic & International Money Transfers.
Where can I get further information?