Topics – January 2019

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Welcome to our monthly newsletter, TOPICS.

This month it includes the following Topics:-

  • PAYE Modernisation – A Summary
  • Tax Topics
  • Minimum Wage from 1st January 2019
  • Employers Obligations
  • Company Secretarial Matters

PAYE Modernisation – A Summary

I refer to previous ‘Topics’ and emails.

PAYE Modernisation was introduced on 1st January 2019. Below is a summary of points for employers and employees

Employers 

  • Ensure all employees are registered with Revenue with correct spelling of names addresses etc
  • When processing payroll follow the steps below
  • Retrieve Revenue Payroll Notifications (RPNs) from ROS for your employees (formerly P2C)
  • Send online ‘Payroll submissions’ to Revenue on or before payment to employees
  • Revenue will respond to the above with a summary of all employees pay and tax deductions
  • Once reports submitted to Revenue, they will issue bill for taxes payable
  • Payments of employees will not alter in terms of due dates and method of payment
  • However Revenue have introduced a variable direct debit method to match the amount due from the weekly / fortnightly/ monthly ‘Payroll submissions’ sent to them by employers. See link below.

https://www.revenue.ie/en/starting-a-business/paying-your-tax/monthly-direct-debit/paye-modernisation-introduction-of-variable-direct-debit-scheme.asp

Employees

  • Employees will need to register for ‘My Account’ with Revenue so they have live access to their tax affairs including viewing weekly / monthly reports submitted by employer.
  • Employees will be responsible to ensure their correct tax & USC bands / credits are registered with Revenue
  • No P60 / P45 will be issued by employers to employees after 2018 tax year.

Tax Topics

  • Further to Budget 2019 the Finance Bill 2018 includes the following tax provisions:-
  • Extension of Benefit in Kind (BIK) exemption on electric vehicles with an original market value (OMV) of up to €50,000 to 31 December 2021.
  • The weekly income threshold for the higher rate of employers PRSI will increase from €376 pw to €386 pw.
  • Rent -a- Room relief will not apply to short term lettings, a minimum rental of 28 days is required.
  • ‘Self assess’ basis introduced for Employment & Investment Incentive Scheme (EIIS). Relaxation of conditions for investors in small companies.
  • Increase in maximum value of shares in Key Employee Engagement Programme (KEEP) to €100,000 in any one year and €300,000 in all years of assessment OR 100% of annual emoluments in year option granted.
  • Start up Exemption for Entrepreneurs (SURE) extended to 2021.
  • If you are interested in starting your own company, you maybe entitled to a tax refund of up to 41% of capital invested under SURE.
  • Three Year Start up exemption to Corporation tax extended to 2021. The relief is linked to Employers PRSI . Maximum relief of €5,000 per employee. Full relief where Corporation tax under €40,000 pa.
  • New valuation date for Local Property Tax (LPT) from November 2019.
  • The VAT rate on tourism activities increased to 13.5% (from 9%) from 1st January 2019.
  • The VAT rate on e-books and electronically supplied newspapers reduced  to 9% (from 23%) from 1st January 2019.

Minimum wages rates from 1st January 2019

These are the Minimum Wage Rates that apply in Ireland from 1st January 2019

  • Experienced adult worker – €9.80 per hour
  • Aged under 18  – €6.86 per hour (70%)
  • First year from date of first employment aged over 18 – €7.84 per hour (80%)
  • Second year from date of first employment aged over 18 – €8.82 per hour (90%)

Further information from the link below:

http://www.citizensinformation.ie/en/employment/employment_rights_and_conditions/pay_and_employment/pay_inc_min_wage.html#l62fd2

Employers Obligations

An employer is responsible for ensuring that their employees receive certain basic employment rights.

The main obligations include:

  • To only engage employees who have permission to work within the State.
  • To ensure that they provide employees with a written statement of terms and conditions of employment.
  • To give employees a written statement of pay or ‘payslip’.
  • To pay employees not less than the statutory minimum wage rates.
  • To comply with the maximum working week requirements.
  • To provide breaks and rest periods during working hours.
  • To give annual leave from work.
  • To give a minimum amount of notice before termination of employment.
  • To maintain records in relation to their employees and their entitlements.

Below is a link for more information:

https://www.workplacerelations.ie/en/Publications_Forms/Employment_Law_Explained.pdf

Company Secretarial Matters

  • Beneficial Ownership Register to be maintained of owners or control more than 25% of shares or voting rights. Register to  be filed with Companies Registration Office (CRO).
  • One Director companies still need a separate Company Secretary.
  • Consideration putting Shareholder agreements in place?