Do you make payments to your employees under any of these headings?
- Travel and subsistence payments (including ‘country money’);
- Small benefits (e.g. tax free vouchers etc); or
- Tax-free employer contributions (up to EUR 3.20 per day) towards remote working expenses.
If so, starting 1 January 2024, you will be required to report details of such payments (called “reportable benefits”) to Ireland’s Revenue as part of your monthly payroll returns. Note, however, that travel and subsistence expenses paid directly by the employer via company credit card/prepaid cards are not currently within the scope of the reporting requirement, nor are fuel cards, toll tags, and similar cards or tokens.
Why the change?
The enhanced reporting requirement (ERR) is being introduced as an extension to Revenue’s PAYE Modernisation scheme, which began in 2019. The stated objective is to obtain quality high-level data to enable the tax authorities to direct resources away from compliant employers.
Is there any change to the tax treatment of these non-taxable payments?
No. The new requirement is solely a reporting obligation; however, details of these payments will need to be reported on or before the date they are made.
How will this affect my business?
Starting next January, your business will be obliged to collate and upload specific information on these reportable benefits to Revenue on a monthly basis (or more regularly, if any reportable benefits are paid at a different interval).
What steps do I need to take?
Your business should review its current systems for recording and paying travel and subsistence expenses to determine whether it will be in a position to comply with the new reporting requirements come next January. If the company’s expenses payment system is not integrated with payroll, you will need to consider how the required information can be collated and made available for inclusion in the monthly payroll returns.
If your business is still paying the remote working allowance, it would be prudent to review the existing controls and procedures to ensure remote workdays are being properly tracked and documented.
If small benefits are potentially being issued to employees from various sources in the business, necessary safeguards will need to be put in place to determine if these benefits are exempt and are reportable in a timely fashion.
Finally, given that this is a new reporting requirement, the business will need to identify who in the organisation is responsible for these filings.
Mark Hynes
BDO in Ireland