Dec 2013
4
What's new in 2014
Thesaurus Payroll Manager 2014 is now available. Click here to download.
2014 Budget Changes to cater for:
- Reduced rate of 4.25% employer’s PRSI to revert to 8.5% (affecting PRSI classes A0 and AX)
- Full year application of LPT (local property tax)
- Illness benefit waiting days increased to six from three meaning that employers will not have to adjust for tax until waiting days have elapsed
- Minor changes to BIK mileage bands
- PRD (pension levy) lower rate reduced from 5% to 2.5%
SEPA
As more banks become SEPA ready, the roll out of payroll software upgrades for these banks will be targeted to those customers affected, so, when preparing a SEPA file, the software will see if a specific upgrade is available for that bank.
Other users will not be inconvenienced by these targeted upgrades.
AIB, Danskebank, ABN Amro and Bank of America are currently catered for within Thesaurus Payroll Manager. Permanent TSB, Ulster Bank and Bank of Ireland are planned this month or 1st January at the latest. The remaining banks will follow as they become SEPA ready and we have successfully processed test files with them.
Cleaner graphics
This takes advantage of the fact that only 0.5% of users are now using 800 x 600 resolution and, for those that are, scroll bars will appear for the larger forms.
The “restore down” button at the top right of the main form previously forced users to keep the program in a maximised state. This button will now allow a user to show the program on part of their screen only. So, for example, you might have a spread sheet showing on your screen alongside the payroll. Some payroll sections will still take over the full screen e.g. payslip print to screen.
General improvements to the software upgrade process and many more 'under the hood' enhancements.
Nov 2013
19
Payroll Tax Tip - November 2013
PAYE Anytime – Benefits to employees
PAYE Anytime is the Irish Revenue On-Line Service for employees. This facility offers individuals who pay taxes under the PAYE system a method to manage their taxes online.
Registration
Registration is quick and easy, a PIN will be issued within 5 working days. Once the PIN has been received PAYE Anytime can be used immediately.
Once registered, you can
• View your tax record
• Claim a wide range of tax credits
• Apply for refunds of tax including health expenses
• Declare additional income
• Request a review of tax liability for previous years
• Re-allocate credits between yourself and your spouse
• Track your correspondence submitted to Revenue
Benefits
• PAYE Anytime gives secure access 24 hours a day, 365 days a year.
• Tax credits will be updated immediately
• Fast repayments
• Mobile phones can be used to track correspondence
Full details can be found on Revenue’s website
Nov 2013
9
Irish Maternity/Adoptive Leave Benefits
When an employee is on Maternity/Adoptive Leave and is receiving payment from the Department of Social Protection they will automatically receive a credited PRSI contribution for each week of leave.
If the employee has taken Maternity/Adoptive Leave but does not qualify for a payment from DSP they are still entitled to the credited PRSI contribution for each week of leave. The DSP has confirmed that if they receive a letter signed by the employer on the company headed paper which state the dates the employee was on Maternity/Adoptive Leave they will credit contributions to the employees PRSI record.
This will ensure that the employee’s entitlements to payments in the future from the DSP are protected.
Oct 2013
31
October tax tip - Investing in a pension
The average life expectancy in Ireland is rising; people are living longer so it’s important to plan for your future. If a pension scheme or product is approved by the Revenue Commissioners you will receive Tax Relief on contributions to it. By contributing some of your salary to a Pension Scheme those earnings are not subject to PAYE. Tax Relief is allowed at the marginal rate of tax so if you pay tax at 41% you will get tax relief at 41% i.e. if you pay tax at 41% it will cost you €59 to contribute €100 to your pension.
AVC refers to any Additional Voluntary Contribution made to a Pension Scheme and would be worth considering for any bonus received to save paying 41% tax on it!
Pension contributions are subject to USC & PRSI.
The maximum allowable contributions for tax purposes are as follows:
Age % of Net Relevant Earnings
Under 30 years of age 15%
30-39 years of age 20%
40-49 years of age 25%
50-54 years of age 30%
55-59 years of age 35%
60 years of age & over 40%
It’s never too early to start a pension, think about it today. For help on processing pensions please refer to the online help file for Thesaurus Payroll Manager/BrightPay or telephone the support team who will be happy to assist you.
Oct 2013
16
2014 Payroll Software Budget Changes
Both Thesaurus Payroll Manager and BrightPay will refect the following changes in 2014.
Illness Benefit
The number of waiting days for Illness Benefit payable by the Department of Social Protection has been increased from 3 days to 6 days. Employees will not be entitled to Illness Benefit for the first 6 days of any period of illness; this will give rise to additional cost to employers who operate a sick pay scheme. Click here for more details.
Employer’s PRSI
The reduced rate of 4.25% Employer’s PRSI is due to revert to 8.5% from 1st January 2014. In July 2011 Employer’s PRSI for those earning less than €356 per week was halved, the rate will be restored to 8.5% from the 1st of January 2014.
Example: For an employee earning €350 per week the Employer’s PRSI is currently €14.88, from the 1st of January this will increase to €29.75
Local Property Tax (LPT)
A half year charge for LPT applied in 2013. From 2014 a full year’s charge will apply.
Benefit-in-Kind
The benefit-in-kind rate applicable to company motor vehicles will change from miles to kilometres with effect from 1st January 2014.
|
Business travel lower limit 2014 |
Business travel upper limit 2014 |
Percentage of original market value |
Business travel lower limit 2013 |
Business travel upper limit 2013 |
Percentage of original market value 2013 |
|
Kilometres |
Kilometres |
|
Kilometres |
Kilometres |
|
|
- |
24,000 |
30% |
- |
24,135 |
30% |
|
24,000 |
32,000 |
24% |
24,136 |
32,180 |
24% |
|
32,000 |
40,000 |
18% |
32,181 |
40,225 |
18% |
|
40,000 |
48,000 |
12% |
40,226 |
48,270 |
12% |
|
48,000 |
- |
6% |
48,271 |
- |
6% |
Pension Related Deduction (PRD)
Budget 2014 didn’t introduce any changes to the PRD rates or thresholds however, under current legislation the 5% rate, which applies to annual earnings between €15,000 and €20,000, will be reduced to 2.5% from 1st of January 2014.
Oct 2013
16
Budget 2014 - Overview (due to take effect from 1st Jan 2014 unless otherwise stated)
PAYE, USC & PRSI
- No change
- The reduced rate of 4.25% employer PRSI is due to revert back to 8.5% in January 2014
Maternity Benefit
- Maternity & Adoptive Benefit standardised at €230 for new claimants from January 2014, existing claimants will not be affected
Illness Benefit
- Waiting days for entitlement to Illness Benefit increased from 3 days to 6 days
Medical Insurance
- Tax relief on medical insurance premiums restricted to €1,000 per adult insured and €500 per child insured from 16th October 2013
Pension Contributions
- Tax relief on pension contributions limited to pensions of €60,000 or less
Top Slicing Relief
- Top slicing relief on ex-gratia termination & severance payments abolished
VAT
- Reduced rate of 9% for the tourism sector to be retained
- All other VAT rates remain untouched
- VAT on cash receipts basis threshold increased to €2m with effect from 1st May 2014
GP Care
- Free GP care for all children under 5
Bereavement Grant
- One-off payment of €850 to the families of the deceased discontinued
DIRT Tax
- Increased from 33% to 41%
Prescription Charges
- Prescription charge increased from €1.50 per item to €2.50 per item
Start Your Own Business Scheme
- 2 year income tax exemption for long term unemployed who start their own business subject to terms and conditions
SME’s Training & Mentoring Programme
- Subsidised financial training programme for small businesses consisting of 2 days dedicated offsite training
Corporation Tax
- Corporation Tax will remain at 12.5%
Medical Cards for the over 70s
- Income threshold for medical cards for over 70s lowered to €900 per week for a couple and €500 per week for a single person, medical card in these cases would be replaced with GP only medical card
Telephone Allowance
- Pensioners telephone allowance worth €114 a year is being abolished
Air Travel Tax
- Reduced to 0% from 1st April
Home Renovation Incentive
- An income tax credit to homeowners carrying out work on their home in the next 2 years, the credit will be calculated at 13.5% of the spending cost up to a maximum €4,050
Jobseekers Allowance
- Claimants aged 18-24 will receive a reduced rate of €100 per week, claimants turning 25 from January will receive €144
Cigarettes
- Cigarette packets will be taxed 10 cent more from midnight 15th October 2013
Wine
- A 70cl bottle of wine will be taxed 50 cent more from midnight 15th October 2013
Beer, Cider & Spirits
- Will rise in price by 10 cent from midnight 15th October 2013
Motoring
- No increase in excise duty on petrol or diesel
No increase in motor tax
Oct 2013
14
BUDGET 2014 – What To Expect?
It may be coming earlier this year, but the expectations are that the Budget won’t be as tough as those that have gone before it. While we won’t know for sure the full impact of this year’s “adjustment” until next Tuesday, it’s likely that – at first glance at least – the measures to be announced won’t cut as deeply as the austerity budgets that have preceded it.
The major tax revenue raising measure in this year’s exercise is likely to be one we are all already starting to come to terms with – Local Property Tax.
Introduced earlier this year, the tax, which is levied on the value of properties across the State, has already generated about €200 million. However, familiarity won’t ease the pain when the full year impact comes into effect in January and it’s still likely to cause some pain. Apart from that, the perception is now that people can’t simply afford to give up any more income. There is just no bite left to take from the apple.
Given the particularly onerous hit those on lower incomes have already taken, we’re unlikely to see any changes to either tax rates or bands. So, by and large, families may emerge from this budget with a similar amount in their take-home pay each month, couple with the recent announcement that children under 5 will receive free GP visits means this budget will be an easier one on the pocket for Irish people.
Higher earners, particularly those coming close to retirement, may be hit by the likely diminution in the maximum pension fund allowable for tax purposes.
Families with public sector employees are unlikely to see any specific measures aimed at them, given that a lot of their terms and conditions are being dealt with in the Haddington Road agreement.
Still, while the headlines might be thankfully free of major tax hikes next Tuesday, the Government is likely to look to raise additional tax revenues in a more insidious fashion.
As always any changes or updates to taxation rules will be catered for in the 2014 Thesaurus Payroll Manager and 2014 BrightPay.
Oct 2013
11
LOCAL PROPERTY TAX (LPT) 2014
LPT 2013 (half year charge) is still quite topical but LPT 2014 (full year charge) is fast approaching!!!
The liability date for LPT 2014 is the 1st November 2013 - if you own a residential property on the 1st November 2013 you are liable for LPT 2014.
Key Dates for LPT 2014
- 1st January – 31st December 2014
Phased payments e.g. deduction at source from salary will continue
- 1st January 2014
If paying in full by cash, payment must be made by 1st January 2014
- 15th January – 15th December 2014
Direct Debits will continue
- 21st March 2014
Single Debit Authority payment deducted
Payment method for 2014:
If you paid your 2013 LPT liability by a phased payment method e.g. deduction at source, direct debit this payment method will automatically apply for 2014 and subsequent years. There is no requirement to notify Revenue of your payment method for 2014 unless you wish to select a different payment method.
If you chose a different payment method in 2013 e.g. Credit/Debit Card, you must confirm your payment method for 2014 by:
- 7th November 2013 (by paper)
- 27th November 2013 (on-line)
In the case of Credit/Debit Card Payments, the full amount will be charged to the card on the day you select this payment method for paying your 2014 LPT liability. This would mean the latest date for paying using this method would be the 27th November 2013.
Full details can be found on Revenue’s website
Oct 2013
7
Making the Most of Tax Reliefs and Credits
There are a wide range of benefits that Irish taxpayers can claim for:
Medical Expenses: Tax relief granted at standard rate of 20%- that’s €10 back for every €50 for doctors and consultants’ fees and prescribed medicines. Relief can also be claimed for a number of other less obvious items, for example - the cost of special diabetic or celiac food products subject to a letter from your doctor.
College Fees: Tax relief is available on fees paid for qualifying third-level courses with the relief applied at a rate of 20% - excluding examination fees, registration fees and administration fees. The first €2,500 of any fees paid in 2013 do not qualify – effectively this means that tax relief will only be available for families with more than one child attending college.
Flat Rate Expenses: People working in certain occupations, such as nurses for example, are entitled to a fixed rate expense allowance to cover the costs of uniform. Flat rate expenses can be deducted from your income before it is taxed. For example nurses who are required to provide and launder their own uniforms are granted a deduction of €733 while shop assistants are entitled to a deduction of €121 and airline cabin crew are granted €64.00.
Disappearing Reliefs: You have 4 years to make your tax relief claim. This means the earliest year for which you can claim is 2009 even if the relief in question has been abolished.
Relief for Service Charges ceased from January 1 2012 but can still be claimed for 2009, 2010 and 2011. A maximum annual spend of €400 on domestic service charges, including waste, water and sewage is eligible for tax relief at 20%.
Relief on Trade Union subscriptions were abolished in 2011 however you can still claim back to 2009 up to a maximum of €350 per annum.
Rent Relief is to be abolished completely by 2018.
Oct 2013
4
CPA Ireland – Practitioners’ Conference 2013
CPA Ireland held their Practitioners Conference in Carton House Friday 20th & Saturday 21st September 2013. Laura Murphy and Audrey Mooney from Thesaurus Software attended the conference. Laura and Audrey enjoyed meeting existing Thesaurus Payroll Manger and Solutions Plus customers – getting their feedback and comments.
It was also an opportunity to show Bright Contracts and our new payroll product BrightPay.
- Bright Contracts is an innovative software package that has everything you need to create and manage your staff handbook and and employment contracts.
- BrightPay is simple to use yet powerful and flexible, it will be offered alongside Thesaurus Payroll Manager giving customers a choice of payroll products.
