Ireland

CurrencyEuro (€) (EUR)
Payroll FrequencyMonthly/Lunar/Bi-weekly/Weekly
CapitalDublin
Date Formatdd/mm/yyyy
VAT23% standard rate.

PEO / Employer on record Services
TopSource offers complete Payroll, PEO and contractor management services for Ireland.
TopSource provides PEO (Professional Employer Organization) services to multi-national companies establishing a presence in Ireland.
As a Professional Employer Organization (PEO), TopSource serves as an outsourced Global employment solutions provider, providing comprehensive employment services such as payroll, payroll related compliances (PRSI, PAYE, USC etc.), and assistance with employer compliances.

Services we offer

Payroll Processing

  • Monthly salary calculation
  • Salary disbursement to employee’s account
  • Monthly pay slip generation (If applicable)
  • RealTime Information (RTI) submission (PAYE Modernisation)
  • Support with Revenue notifications

Company formation in Ireland
TopSource being a Tax Agent can register a company with the Revenue Ireland for PAYE Only service. This includes both Resident and Non Resident companies.

What is PAYE?

PAYE stands for ‘Pay As You Earn’. If you are an employee, you normally pay tax through PAYE. Every time your salary is paid, your employer deducts Income Tax (IT), Pay Related Social Insurance (PRSI) and Universal Social Charge (USC) and pays the amount deducted to Revenue.

PAYE ensures that the yearly amounts you must pay are collected evenly on each pay day over the course of the tax year.

Tax Rates and Bands
Personal Circumstances 2019
Single, Widowed or a surviving civil partner w/o qualifying child € 35,300 @ 20%
Balance @ 40%
Single, Widowed or a surviving civil partner qualifying, Single Person Child Carer Credit (2014) € 39,300 @ 20%
Balance @ 40%
Married or in a civil partnership (One spouse or civil partner with income) € 44,300 @ 20%
Balance @ 40%
Married or in a civil partnership (Both spouses or civil partner with income) € 44,300 @ 20% (with an increase of 26,300 max)
Balance @ 40%
Increase Band Rate
If both the partners are working, it is increase by the lower amount of either i.e one earning € 44,300 and other earning € 26,300 (€ 44,300 + € 26,300)
Tax Credit -> Reduces Tax an employee pays
  -> Are normally given for a full tax year
Tax Basis for calculating the tax
Normal Cumulative basis
Week 1 Non – cumulative basis
Emergency Flat 40% with Tax credit in first pay period
  Flat 40% without Tax credit in later pay period
Universal Social Charge (USC)

USC is a tax that is payable on your employees’ income, including notional pay. Notional pay, or benefit in kind, is the value of any taxable benefits you give to your employees. Some types of income are exempt from USC, for example, Department of Employment Affairs and Social Protection (DEASP) payments.

You will receive a Revenue Payroll Notification (RPN) for each of your employees. This will tell you what USC rates and cut-off points to apply.

If your total income exceeds €13,000 you pay USC on your full income.

Standard Rate and Thresholds
First € 12012 0.50%
Next € 7862 2%
Next € 50170 4.50%
Balance 8%
Pay Related Social Insurance (PRSI)

PRSI is a payment made by you and your employees. The value of this payment is based on the amount of your employee’s pay. PRSI is the main source of funding for social welfare payments.

The total amount paid for an employee in one pay period is called a PRSI contribution. It is made up of the:
  • employer’s share, that is, the amount of PRSI you pay on your employee’s pay
  • employee’s share, that is, the amount of PRSI an employee pays on their own pay.

Each employee has a PRSI contribution class. This class determines the rate you use to calculate the PRSI you deduct.

The Department of Employment Affairs and Social Protection provides details of each PRSI class, and the PRSI contribution rates.

Who Pays PRSI
  • All employees whether full-time or part-time earning €38 or more per week
  • Self-employed workers with an income of €5,000 a year or more
  • Who are aged 16 or over and under pensionable age
Class – A This considered as A1 which is used for most of the employees in the normal pay
Sub Class – 1
Rate of Contribution Employee earning more than € 424 will have below deductions on his total earnings
Employer 10.95%
Employee 4%

Local Property Tax (LPT)
A property is liable for Local Property Tax (LPT) if it was a residential property on the valuation date of 1 May 2013. You are liable to pay LPT if you are the owner of a liable property on the liability dates. Commercial properties are generally not liable to LPT.

Each property will have a unique property identification number (ID) for LPT purposes. This ID number is provided to you on official correspondence and should be retained and used in all LPT correspondence. You will also be provided with a PIN number for accessing your LPT account online at Login to LPT online. Your PIN will also be quoted on official correspondence and is required to securely access the LPT online system.

The property ID number, the PIN number and your Personal Public Service Number (PPSN) or Tax Reference Number are required to successfully access your LPT record online. If you need to request a property ID and PIN number, enter your PPSN or Tax Reference Number when you Login to LPT online. Your Property ID or PIN will be posted to you at the address on file for the PPSN or Tax Reference Number you supplied.

This is decided by Revenue Ireland for the whole year and it split into the equal number of pay periods.

PAYE Modernization
The PAYE Modernization legislation modifies the way employers submit their PAYE information to Revenue. From 1 January 2019, employers are obliged to report their employees’ pay and deductions to Revenue when or before they pay them.

These new reporting obligations involve the most significant changes to the Pay As You Earn (PAYE) system since its introduction in the 1960s.
SMART PAYE outlines the benefits of PAYE modernization for employees, employers and for Revenue.

The benefits for an employee, include:
  • the ability to maximize the use of your entitlements
  • the availability of real time accurate data through the online systems of Revenue Ireland
  • clear information about the deductions being reported to Revenue on your behalf.
The benefits for an employer:
  • Real Time Payroll Submission, which means no more year end activities
  • RPN (Revenue Payroll Notification), a replacement of P2C
  • RPN includes the below details –
    1. a. Tax Credits
    2. b. Tax Thresholds
    3. c. PRSI Class
    4. d. USC Thresholds
    5. e. LPT Amount (If Applicable)
    6. f. New Joiners YTD and Tax Credits (Replaced P46s)
    7. g. Leavers get submitted via RTPS (Replaced P45s)

Revenue Online Service (ROS)
ROS is Revenue’s online facility providing business customers with a quick and secure way to conduct their business electronically with Revenue. TopSource is registered for TAIN (Tax Advisor Identification Number) and can assist client in completing the below online services on behalf of client –

  1. a. Register as an employer on e-Registration
  2. b. Online calculation facilities
  3. c. Simpler user-friendly return forms
  4. d. Receive online notifications
  5. e. Make liability payments on behalf of client i.e using direct debits or online banking.

What is benefit in kind?
A benefit-in-kind (BIK) is any non-cash benefit of monetary value that you provide for your employee.

These benefits can also be referred to as notional pay, fringe benefits or perks.

Year End
From 2019, an end of year statement will be available to all employees in their “myAccount” revenue login.

This will include details of all the pay and deductions from all employments for that tax year.

About Employment in Ireland

Working Hours

A full time worker can work between 35 – 40 hours per week on an average – normally the maximum average working week for many employees cannot exceed 48 hours. This doesn’t mean that a working week can never exceed 48 hours; it is average that is important. The 48 hours of work do not include annual leave, sick leave or maternity or adoptive or parental leave. Under the Protection of Young Persons (Employment) Act employers cannot employ children under 18 years of age.

Holiday Entitlement

All full-time workers in Ireland are entitled to receive 20 paid holiday days each year, although many companies include more than this within their contracts. An employee who has worked at least 1,365 hours in a leave year is entitled to the maximum of 4 working weeks’ paid annual leave unless it is a leave year in which they change employment.
Usually the Holiday Year is same as tax year from January to December.

Maternity Leave

Female employees are entitled to 42 weeks of maternity leave which translates to 10.5 months. This benefit is paid by the Department of Employment Affairs and Social Protection to women who have a certain number of paid PRSI contributions on their social insurance record and are in insurable employment up to the first day of their maternity leave. Maternity Benefit is taxable for all claimants. It has to be applied at 6 weeks before an employee intends to go on a leave.

Paternity Leave / Parental Leave

Paternity Leave- 2 weeks of paternity leave allowed. Taken in the first 26 weeks after birth of the child

Parental Leave- 18 weeks of parental leave, taken in the first 8 years of the child’s life.

Social Security

For employees with weekly earnings of €356 or less, 8.5% of gross wages; for employees with weekly earnings greater than €356, 10.75% of gross wages. There are no maximum earnings used to calculate the employer’s contributions. The employer’s contributions also pay for sickness and maternity, work injury, unemployment, and adoption benefits.

Termination

Employees who have been in continuous employment for at least 13 weeks are obliged to provide their employer with one week’s notice of termination of employment. If a greater amount of notice is specified in the employee’s contract of employment, then this notice must be given.

Pension

Will be applicable from next tax year from January 2020.

Employer Contributions

By statute, employers in Ireland contribute only for:
• PRSI ER – Employer share on employee’s pay (Pay related Social Insurance)

To learn more, contact us now.

Contact Sales

0203 6915303
contactus@topsource.co.uk

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