Budget 2013 - Advance Notice of PRSI Changes

The Advance Notice of PRSI Changes for Computer Users 2013 is now available on welfare.ie at  

 

http://www.welfare.ie/EN/Publications/Advanced2013/Documents/anprsi2013.pdf

Budget 2013 - BIK on preferential loans

Increase from 12.5% to 13.5% in the specified interest rate used in calculating the taxable benefit from preferential loans, other than home loans. The specified rate used to calculate the taxable benefit from home loans is decreased from 5.0% to 4.0%. Specified interest rates are reviewed annually in the light of current interest rates available in the market.

Budget 2013 - PRSI and USC Changes

The abolition of the standard PRSI allowance means most workers will pay an extra €264 a year. The minimum contribution from the self-employed will rise from €253 to €500.

The reduced rate of USC for those over 70 with an income in excess of €60,000 will be discontinued at the end of the year. 

Budget 2013 Main Points

The main points of the budget as announced today by Finance Minister Michael Noonan are:

• The abolition of the €127 a year PRSI allowance.
• Child benefit cut by €10 per month
• Capital Acquisitions Tax threshold falls by 10 per cent.
• Carbon tax extended to solid fuels
• Corporation tax remains unchanged
• DIRT increases by 3% to 33%
• Motor tax to rise from January 1st
• Excise duty on tobacco to increase
• €1 duty increase on wine
• 10 cent rise on spirits, beer and cider
• No increase on petrol/diesel
• Property tax will be collected by the Revenue
• Property tax based on market value introduced
• Increase in USC for over 70s with incomes of €60,000+
• Homes bought in 2013 exempt from property tax
• Film tax relief extended to 2020
• Tourism 9% VAT rate to remain for 2013
• Farmers to get extended rate of stock relief
• CRO to publish guidance for SMEs on credit
• CRO to extend team of reviewers
• Diesel rebate for hauliers from July
• R&D tax credits amended to encourage innovation
• Tax reform plan for SMEs

Revenue Revised USC FAQ's

Revenue has revised its Universal Social Charge Frequently Asked Questions Document which is available on the following link www.revenue.ie/en/tax/usc/universal-social-charge-faqs.pdf

Budget 2013 - Property Tax

It has been reported in the Irish Independent that the new property tax, now to be collected by Revenue will be implemented as follows

P60 format Changed for 2012

Revenue have issued a new P60 format for 2012 which can be seen using the following link

http://www.ros.ie/PublisherServlet/offlineapps?language=en&languageSelect=en#Publications

and scrolling down to the P60 Section.

Employers will need to be careful when issuing P60's as the employees address no longer appears. It will also cause problems for employers who post P60's as address labels will now need to be used. In our EuroPayX payroll product it is possible to email P60's direct to the employees. Ardbrook will try to include the address on the P60 and to get it Revenue approved.

Other changes to the P60 include

• the amount of taxable illness benefit is now shown
• Flag to indicate if USC amount was deducted or refunded
• Previous employment Pay for USC
• Employers email address no longer shown

Budget 2013 Troika calls for €1.25 in new taxes!

A report on the seventh review on the terms of Ireland’s EU-International Monetary Fund bailout, which was published this afternoon, states that revenue measures to raise at least €1.25 billion in the Budget will also include 

Budget 2013 Toughest Ever?

The Taoiseach Enda Kenny warned last night that the coming budget will the the toughest yet with a package of cuts and tax increases. December's Budget will be a €3.5bn package, with €2.25bn coming from cuts, and a further €1.25bn in extra taxes.

There is also disagreement between the coalition parties on whether PRSI charges should be increased or social welfare payments reduced to cover a deficit in the social welfare fund of  €2.2bn.

Bank Modulus Check Updates as over 130 Bank Branches Close

With the proposed closing of over 130 bank branches, updates to the Ardbrooks Bank Modulus Checker routine ( validates bank account numbers ) will be fairly frequent over the next 12 months as bank accounts are moved from one branch to another. This is especially true in the case of AIB bank accounts as their validation links the bank account number to the sort code which will change as branches close.

New Format PPSNs

New format PPSNs will be issued for new applicants with effect from 1^st January 2013. The format of these numbers will be 9 characters i.e. 7 numeric followed by 2 alpha characters with the second alpha character being A e.g. 1234567SA. 

Revenue Reduces Administrative Burden on Business by 25%?

A report published by Revenue on the 18th July 2012 shows that Revenue has reduced the administrative burden on businesses by 25%, saving businesses over €85 million a year.

Revenue Email Scam

The Revenue Commissioners have become aware of further fraudulent emails purporting to come from Revenue seeking personal information from taxpayers in connection with a tax refund. These phishing emails are headed ‘Irish Tax and Customs Online Confirmation’ and ‘Irish Tax and Customs Notification’. A link opens up a form seeking personal information.

These emails did not issue from Revenue.

The Revenue Commissioners never send emails requiring customers to send personal information via email or pop-up windows.

Changes to handling of Share Options

Any gain arising on the exercise of a share option is liable to income tax, USC and employee PRSI. There is no employer PRSI liability. There have been changes on how this is handled from 1^st July 2012.

Make Tax Payments By Credit Card on ROS

A facility to pay tax by credfit card (limited to VISA and MasterCard) to Revenue using the Revenue On-Line Service (ROS) is now available. A person wishing to pay by credit card via ROS must pay a transaction charge, of 1.49% of the value of the payment. This charge is purely related to third party fees incurred by Revenue, in the provision of this service.

SEPA electronic payments software

Ardbrook now has a version of our PayCE (Direct Debit, Direct Credit) software available which can create SEPA ( Single European Payment Area ) Credit transfers (SCT). SEPA will enable customers to make cashless euro payments to anyone located anywhere in the area using only a single bank account and a single set of payment instruments, this means that for example payments can be made from using an irish bank account to any bank account in counties covered by SEPA.

ROS & Revenue.ie website Availabilty

It has been announced that to allow for an essential upgrade on Monday 30th July 2012, the following online Revenue services will be unavailable at the date and times listed.

Updated USC FAQ's

An updated version (26 July 2012) of the USC FAQs has now been published on the Revenue website at

 www.revenue.ie/en/tax/usc/universal-social-charge-faqs.pdf

Mandatory Sick Pay Scheme Proposed

The Minister for Social Protection has proposed the introduction of a Mandatory Sick Pay Scheme,  whereby the employer will be obliged to pay the equivalent of the State Sick Pay for the first 4 weeks of any sick leave for all employees. Its aim is to reduce the cost of funding Illness Benefit which is currently paid by the DSP to eligible employees while they are on sick leave.  An increase in employers PRSI has also been proposed.

Taxation of Illness Benefit

Previously some Employers adjusted Cut-Offs by the amount of taxable illness benefit. From 1st January 2012 Employers must include the taxable Illness Benefit with the employee's earnings and subject the taxable Illness Benefit to PAYE but no PRSI or USC applies. For further details on what this means for Irish payroll administrators click on the following link

http://www.revenue.ie/en/business/paye/employer-notices/may-2012.pdf

Revenue have already modified the 2012 P35 XML return file to show earnings inclusive of taxable Illness Benefit and a new dedicated field for taxable Illness Benefit. For payroll this means that illness benefit must now have a seperate pay element.

Revenue To Collect New Property Tax

It was announced Today that the Revenue Commissioners will collect the New Property Tax to be introduced next year which will replace the Household charge. It will be at least October before further details on property tax rates will be available.

The unanswered question is, does this mean that the property tax will be deducted directly from the wages of PAYE employees?

Updated Employers Guide To PAYE

Revenue has updated the Employers Guide to PAYE guide which can be downloaded from their website -

http://www.revenue.ie/en/business/paye/guide/employers-guide-paye-calculation.html

Payroll Changes expected for Budget 2013

The Minister for Finance Mr Noonan announced today that there would be €1 billion plus in tax increases in the next budget scheduled for the first week of December 2012. It has been previously stated in the Memorandum of Understanding on the EU-IMF-ECB bailout that these would come from:

• A lowering of personal income tax bands and credits.
• A reduction in private pension tax reliefs.
• A reduction in general tax expenditures.
• A increase in property tax.

Mr Noonan also stated that the budget would be helped by a tax carryover from 2012.

Ulster Bank Problem Enters Third Week

Ulster Bank has failed to clear its transaction backlog and has indicated that it may be well into next week before it can do so.

PRSI Increases on the way?

The Minister for Social Protection Joan Burton has indicated in a speech at the weekend that she is in favour of increasing PRSI contributions for both employees and employers.

Ulster Bank Problems processing Transactions

The problems Ulster Bank had processing transactions last week will continue into this week. Ulster Bank have stated that the backlog is now unlikely to be cleared before then end of the week.