Ireland: Finance Act 2022
The Finance Act 2022 requires employers and payroll processors to report details of certain payments made to employees and directors in addition to previous compliance requirements. The new ERR has been broken down into phases with phase one effective 1 January 2024.
At time of writing, no details are available for timing of the other phases.
Where employers make one or more of the payments listed below, details must be submitted electronically to Revenue. This submission must be made on or before the date of payment to the employee.
Where Crowe provides payroll processing, all expenses relating to the below need to be provided to your Crowe contact monthly to ensure they are submitted to Revenue as required.
Phase one
Phase one requires mandatory reporting to Revenue by employers of benefits made without deduction of tax.
- Small benefit exemption
- Travel and subsistence payments
- Remote working daily allowance of EUR3.20
Small benefits
The value and date of payments of vouchers or other tangible non-cash benefits with a maximum value of EUR1,000, or a total of two benefits in a tax year.
Travel and subsistence
The amounts and dates of payment for each of the following:
- vouched travel and subsistence
- unvouched travel and subsistence
- site-based employees (including Country Money)
- emergency travel
- eating-on-site allowance.
Remote working daily allowance
The number of days, amounts paid and dates of payments must be reported if the employer makes a tax-free payment of EUR3.20 per day to employees for remote working.
Reporting ERR to Revenue
Where an employer has payroll management software, Revenue will provide facilities to enable the payroll software to report required information directly to Revenue.
Revenue will provide third party software providers with facilities to integrate with Revenue systems.
Employees will be able to view the employer submissions in myAccount.
In summary, for relevant clients, all expenses to be paid out to employees in the month need to be shared with your usual Crowe contact by the payroll cut-off date. Crowe will then report the mandatory benefits monthly, via the payroll, to Revenue.
Change to reporting of non-qualifying stock options in Ireland
From 1 January 2024 Finance (No. 2) Bill 2023 requires that employers in Ireland withhold Irish payroll taxes and charges from gains arising on the exercise of share options.
Previously, this has only been required on taxable gains arising from Restricted Stock Units (RSUs). However, all equity types must now be considered. Share option gains are currently the only form of share-based remuneration taxed through the Irish self-assessment system. Employer's obligations to date being limited to an annual reporting obligation. This change in legislation means that employers in Ireland are now legally obliged to report these taxable gains on behalf of employees.
Where Crowe is responsible for payroll and stock option reporting, employers need to inform their Crowe contact of any exercises for Irish based employees from 1 January 2024 to ensure that the necessary action is taken in the payroll to maintain the new compliance obligation. Information required for each employee exercise is as follows:
- Price of share at grant date.
- Fair market value of share at exercise date.
- Number of shares being exercised.
- Date of the exercise.
