PAYE Modernisation: preparing for the year-end (Sponsored)

Dec 11, 2019
One of the major selling points for PAYE Modernisation is that there are no returns due to be completed at year-end. Can it really be that simple?

The abolition of all ‘P’ forms

When Revenue announced the introduction of PAYE Modernisation, one of the key selling points for practitioners and employers was the abolition of all the “P” forms: P30, P45, P35 and P60s.

So, as we approach year-end, we don’t have to worry about preparing a P35 or printing P60s. The only task for employers now is to download their 2020 RPNs, and then watch December 2019 simply roll into January 2020 from a payroll perspective.

However, it is likely that many employers still think that they have to prepare a P35, not to mention the number of employees who are going to ask, “Where is my P60?”

Replacing the P60

Under PAYE Modernisation, the employer is no longer responsible for preparing P60s for their employees. That task now falls to Revenue.

Revenue will be issuing two new documents to all employees via the myAccount portal:

  1. Employment Detail Summary (P60 replacement); and
  2. Statement of Liability (Similar to a P21).

Employees will be issued with an Employment Detail Summary (EDS) for each employment that they had in 2019, summarising their pay, tax, USC and PRSI, etc. These EDS documents can be printed or securely shared with third-parties, such as banks, with a password from within the employees’ myAccount portal.

The Statement of Liability gives an overview of PAYE and USC across all employments in 2019, and will include preliminary balancing figures for both PAYE and USC. Employees will then be able to complete an income tax return, declare any additional income, change existing and claim additional credits. At the end of the process, the employee will be able to claim any tax refunds that arise, or make arrangements to pay any outstanding liabilities.

So the employer is off the hook?

While Revenue are generating the EDS documents for employees, they are using the data that has been submitted by employers under PAYE Modernisation. If the employer has made a mistake, then the documents issued by Revenue will be incorrect. Revenue will be directing employees to make contact with their employers if there are any details that are incorrect on the documents.

As the year end approaches, employers should start checking their records to ensure that they have no outstanding submissions, and any corrections made after submission have also been filed.

Of the 2.89 million employees in Ireland, only 152,000 users have viewed 400,000 payslips (out of approximately 70 million), so it is likely that errors may not have yet been spotted by employees.

One final task for year-end

You may not be aware of the fact that, after 31 December, you will not be able to download a 2019 RPN for any employee, either through your payroll software nor the Revenue website.

We would highly recommend that all employers download a 2019 RPN to keep before the year-end – you never know when you might need it!

Visit www.collsoft.ie to find out how CollSoft Payroll can help improve the quality of your payroll data.

(This article is sponsored by CollSoft Payroll.)