Top 5 upcoming changes in PAYE's Modernisation

Top 5 changes in PAYE's Modernisation

Having been in use since the 1960’s, Revenue’s PAYE system is overdue a significant update. On the 1^st of January 2019 revenue will introduce a completely rejuvenated PAYE system that is going to transform how businesses do payroll. But what exactly is PAYE's Modernisation changing and what does this mean for your business? Here are 5 changes to expect from the new system.

1. Get ready for ‘Real Time’

As an employer, you will now need to report employee’s pay and deductions electronically as they happen - weekly, fortnightly or monthly. For businesses who use payroll software, this will be a seamless process. However, for smaller businesses who manage payroll manually, compliance with these changes could prove to be time consuming. The benefits for both businesses and their employees is that that real time information will ensure the right amount of Income Tax, USC and LPT is deducted and paid.

2. Say goodbye to the 5 P’s

Yes, that’s right - P30’s, P35’s, P45’s, P46’s, P60’s and end of year reporting will all be eliminated. Tax, PRSI and USC will be calculated immediately in ‘Real Time’ and errors can be resolved as they happen instead of at the end of year.

3. Move over P2C, Say hello to the new RPN

Revenue Payroll Notification (RPN) is replacing P2C. Employers will be able to retrieve a RPN on Revenues ‘Lookup RPN’ web service. This will provide the relevant details on how to tax an employee before being paid.  An RPN can also be requested before setting up any new employees on your payroll system.

4. Accuracy and Speed

PAYE Modernisation will create the need for employers to stay consistently accurate as continual adjustments can lead to Revenue review.- Did you know that there can be duplicate PPSN’s? PAYE Modernisation will ensure they will all be corrected and everybody’s number will be unique, completely minimizing the chance of errors and speeding up processes.

5. Simplified Online Services.

It’s all about being user friendly these days, and that’s no different for Revenue. The PAYE Modernisation is going to make the full payroll process seamless. Revenue are going to make it even easier for users to engage and use services online. This will not only create transparency for employees of how PAYE works but also it will make things a lot easier for your Payroll staff! Smart Benefits for Employers as per Revenue

• Seamless integration into Payroll
• Minimize employer cost to comply
• Abolition of p30s p45s p60s and end of year returns
• Right tax paid on current due dates
• Time savings

What do you need to do next ahead of?How complete and accurate is your employee payroll data? As a business, the most important thing you can do is to make sure your payroll procedures capture accurate and timely payroll information. Consider reviewing procedures for collection of Benefit in Kind or Expense information.