Change to employer reporting requirements set from January 1
Employers would be well-minded to check over their existing administration of these payments to make sure they are fully compliant.
There are major changes coming on stream for 2024 in respect of employers reporting requirements to Revenue.
The changes affect payments to employees for remote working daily allowance of €3.20, the payment of travel and subsistence expenses, and the small benefit exemption, which covers up to €1,000 a year, which can be split into a maximum of two benefits if so desired.
Under the new rules which are destined to kick in from January 1, 2024, employers making any of the above payments to their employees must first give advance notice to Revenue that they will be making such payments.
Current rules which came into effect in 2019 require all employers to submit payroll details to Revenue in respect to each employee or director in their employment, on or before the date they make a payment of wages to the employee/director.
As part of the process, the employer submits a request for payroll notification which effectively downloads the current tax credits and tax band and informs the employer of how much income tax, USC and PRSI should be deducted.
Employers are obliged within the current scheme to report the taxable benefits accruing to the employee. The new rules are extending the reporting requirement to tax-free benefits.
Employers would be well-minded to check over their existing administration of these payments to make sure they are fully compliant, as Revenue will have more visibility on the amount of benefits paid in total and the amounts per employee.
On mileage and subsistence, there are specific records that need to be kept, including the start and finish of the journey, distance travelled, purpose of the journey and appropriate mileage rate.
One must also assess whether the travel is in the performance of the employees' duties or incurred by the employee in getting themselves into a position to perform their duties (that is, travel for work rather than travel to work).
The standard mileage and subsistence rates are available from the Department of Finance but other special schemes also exist for certain industries such as the construction sector and the haulage sector.
On the reporting requirements, the following information will now be required to be submitted before the point of payment.
For the small benefit exemption, the reportable details are:
- The value of the benefit;
- Date granted to the employee/director. It is important for employers to note that a maximum of only two benefits can be tax-free per year and the Revenue guidance shows how trivial benefits such as Easter eggs or Christmas hampers can make the €1,000 voucher which an employee subsequently receives a taxable benefit.
For the remote working daily allowance, the reportable details are:
- The total number of remote working days;
- The amount paid;
- The date paid to the employee/director.
For travel and subsistence, the reportable details are the amount paid and the date paid to the employee/director for each of the following subcategories:
- Travel vouched;
- Travel unvouched;
- Subsistence vouched;
- Subsistence unvouched;
- Site-based employees (including “Country money”);
- Emergency travel;
- Eating on-site allowance.
In practical terms, most employers will use payroll software or employ the services of an accountant or payroll agency to operate their payroll and the new reporting requirements will just mean the payroll system is populated with the additional information required.
The important thing to note is that these payments are reportable in advance of actually making the payment.
