10/12/2018 - PAYE Modernisation - Checking your RPNs & Finalising your 2018 Payroll

Payroll 2019

Payroll 2019 will be available to download from our website from Monday 17th December, and we will publish a bulletin when it is available.

Your Final 2018 Payrolls - Ending your 2018 Tax Year Correctly

With the introduction of Payroll Modernisation , any payments that you make to your employees dated from 1st January onwards must be reported to Revenue as a 2019 payment, and the tax liabilities will be incurred in 2019. This is a very important fact to be aware of as you start processing your final payments in 2018.

For example, if you are processing your final December wages on 28th December, but your employees actually receive the payment on 2nd January, then Revenue will consider this to be a 2019 payment and must be recorded in your 2019 Payroll.

This could mean that your employees do not have a Week 52, or Month 12 in their 2018 Payrolls, and this could have particular consequences for their PRSI contributions as they may not have a full year of contributions in 2018.

You must make sure that all of your 2018 wages are actually paid to your employees before the 1st January 2019.


For more information please refer to Page 83, section 10.12 of the new 2019 "Employers Guide to PAYE" published by Revenue at


https://www.revenue.ie/en/tax-professionals/tdm/income-tax-capital-gains-tax-corporation-tax/part-42/42-04-35a.pdf


Emergency Tax

There are some significant changes to how Emergency Tax is operated in 2019 that you should be aware of.

  • Any employee for whom you have not received an RPN (the new name for P2C) from Revenue in 2019 must be taxed on an Emergency Basis.
  • You are not allowed to carry forward any 2018 tax details into 2019 (things like tax credits and standard rate cut off points).
  • For an employee without a PPSN, the emergency basis charges PAYE at the rate of 40% on all earnings - no tax credit or cut off point can be applied.
  • For an employee with a PPSN, the emergency basis allows a standard rate cut off for the first 4 weeks of €679, but a zero tax credit. After the 1st 4 weeks the employee will pay PAYE at 40% on everything - no tax credit and no standard rate cut off.

For more information on how emergency tax should be operated in 2019 please see the Revenue publications at


https://www.revenue.ie/en/jobs-and-pensions/documents/emergency-rates.pdf

and

https://www.revenue.ie/en/jobs-and-pensions/paye-modernisation-for-employees/what-effect-will-this-have-on-emergency-tax.aspx


Checking your RPNs from Payroll 2018

In order to avoid having to apply the emergency tax basis for any of your employees it is important that you check your 2019 RPNs as soon as possible.

This can be done using your 2018 software by selecting the "ROS" > "PAYE Modernisation" > "Get RPNs" menu at the top of the payroll screen. Using this you will be able to download your 2019 RPNs, and Payroll will identify any employees in your system for which Revenue have not issued an RPN.

We have also modified the ROS Digital Certificate validation process so that Payroll Bureaus or Tax Agents can pull down and verify a batch of RPNs in a single process.

To do this select the "ROS" > "PAYE Modernisation" > "Manage ROS Certificates" menu item and then press the "Validate Certificate" button. This will start the validation process with a new option to "Download RPNS" which will download and verify the RPNs for a batch of Employers in one process. Please note that this requires that you are running Payroll 2018 Build 110 or higher.

We have posted a short video outlining both process on our Vimeo page at https://vimeo.com/305106545
Creation date: 10/12/2018 12:07     Updated: 12/12/2018 11:04
Bulletins for Payroll 2018