Ifac are Urging Farmers to Prepare for PAYE Changes

Changes are coming to how farmers manage their employees PAYE. James Farrell, partner at Ifac’s Offaly office takes a look at what this means and how you should prepare in advance of the 1^st of January

If you are a farmer with employee’s or even one employee your PAYE system is going to get a little more complicated from 1^st January 2019 as it is set to be reformed by revenue – this reform is being referred to as PAYE modernisation.

All employers, including farmers with a small team of employees, or even just one, must comply with the new rules from the first of the New Year. Ifac are calling on all farmers to ensure that they are adhering to these new rules by preparing now. In order to be fully compliant, it is important to check that you are operating PAYE correctly as you will no longer have the luxury of correcting errors on the P35 at the end of the year.

Currently, many employees receive incorrect tax credits because Revenue only gets payroll information from employers once a year. In future, employers will submit payroll information to Revenue in real time which means Revenue can allocate correct tax credits and employees will avoid overpayment or underpayment of tax.

What this means for employers

As an employer you will now have to provide details of each employee’s pay and tax deductions to Revenue on or before every pay date. This will need to be done before you finalise payslips. It will include information on PAYE, USC and PRSI. The information is submitted to Revenue via a Payroll Submission Request (PSR). Your payments will not change —i.e. if you currently pay monthly or quarterly, this remains the same.

At the end of each month, Revenue will provide you with a statement summarising the information that you have provided. You will be able to view this statement on ROS from the fifth day of the month and you have until the fourteenth day of the month to check and correct your reports for the previous month.

Are you prepared?

To get ready for the new PAYE regime, you need to check the following:

• Have you the right Personal Public Service (PPS) number for all your employees?
• Have you registered your employees with Revenue?
• Have you an up-to-date tax credit certificate for all your employees?
• Have you completed the P45 process for any employees who have stopped working for you?
• Have you adequate controls in place to ensure that benefits/notional pay are being accurately calculated during the year?
• Are you aware of your duties as an employer at the end of the year?

ifac is over 40 years in operation with 30 branches nationwide providing advice to agribusinesses and the farming community on tax, accountancy, pension planning, succession planning and other areas to help clients across the supply chain develop a profitable and sustainable business.