Under the Taxsaver scheme (www.taxsaver.ie) employers in the Republic of Ireland can purchase tax free monthly or annual bus and rail tickets for employees and directors. [Read more…]
At present, earnings under €10,036 in a tax year are exempt from Universal Social Charge (USC). This threshold will rise to €12,012 in Tax Year 2015.
Many part-time employees earning less than €10,036 are charged USC and have to claim a refund at the end of the tax year. [Read more…]
Section 33 subsection 1 of the Organisation of Working Time 1997 states the following:
“An employer shall not employ an employee to do any work in a relevant period during which the employee has done work for another employer, except where the aggregate of the periods for which such an employee does work for each of such employers respectively in that relevant period does not exceed the period for which that employee could, lawfully under this Act, be employed to do work for one employer in that relevant period.” [Read more…]
An employer contribution to a Personal Retirement Savings Account (PRSA) is a chargeable benefit-in-kind for tax purposes in the hands of the employee. As the Universal Social Charge (USC) treatment follows the income tax treatment, USC should be deducted on this employer contribution.
While these contributions are regarded as a taxable benefit in the employee’s hands, these same contributions qualify for full tax relief subject to certain age-related limits. This only relieves them from PAYE and PRSI however and the USC liability remains.
Employers should ensure that any PRSAs are set up correctly on their payroll systems to ensure that USC is deducted from employees on any employer contribution.
For further information, please contact us on 091-778911 or email firstname.lastname@example.org
Where an employee has more than one employment, it is important that tax credits, standard rate cut-off points and Universal Social Charge cut-off points are allocated correctly between the employments. [Read more…]
JobBridge is the National Internship Scheme that provides work experience placements for interns for a 6 or 9 month period.
Its aim is to help jobseekers gain valuable experience who are unable to get a job without experience. This can be as new entrants to the labour market after education or training or as unemployed candidates wishing to learn new skills. [Read more…]
A standard flat rate expenses allowance (deduction) against tax is set by Revenue for various classes of employees. [Read more…]
JobsPlus is an innovative incentive for employers which was introduced by the Department of Social Protection from July 1st 2013.
The aim of the scheme is to reward employers who provide full-time employment opportunities to people who have been unemployed for more than 12 months.
There are 2 levels of payment: [Read more…]
PRSI Earning Bands
Employers should be aware of an anomaly caused by the earnings thresholds on PRSI Class A contributions.
Class A is the most common PRSI class and covers employees under the age of 66 in industrial, commercial and service-type employment who have reckonable pay of €38 or more per week from all employments as well as Public Servants recruited from 6th April 1995. The earnings bands operate as follows:
The anomalies arise where employees cross the €352 and €356 weekly pay bands. This is because when the weekly pay bands are exceeded, the higher contribution rates apply on all pay not just the amount in excess of the weekly pay band. It should also be noted that contributions are calculated on a week by week and not on a cumulative basis.
The following table illustrates the problem:
So an increase in gross pay from €352 to €355 means an employee is significantly worse off because they now pay 4% Employee PRSI on the full €355 and not just the amount over €352.
Similarly, when gross pay increases from €355 to €357, the Employer PRSI contribution jumps from 8.5% to 10.75%, again on the full €357 and not just the amount over €356.
Where an employer has a number of employees in these earning brackets, particular attention should be paid to ensure that neither employees nor the employer are disadvantaged by these anomalies. This can be achieved by careful rostering of employee hours.
If you require further information, why not contact us.