Changes to payroll systems are to come into effect from tomorrow 1 January.

Under the new system every time an employee is paid, details will have to be submitted to Revenue.

Speaking at a recent IFA farm employment seminar, Vincent Kenrick from the Revenue said: “The new system will not affect the amount of tax you will pay, nor will it change the way you pay tax.

"It will change the way your report the info on how you pay employees and what tax you have deducted.”

Changing employment nature

The immediacy with which information is submitted to Revenue is what will be changing.

Up until now information was submitted at years end. From now on information will be submitted at the time of payment.

This information will be submitted online and all forms such as P45s and P35s will be abolished.

Kenrick said the reason for the change was the changing nature of employment.

He said that few people were now taking jobs for life and instead changed employment more regularly.

He also said that people had an expectation for Revenue to modernise and utilise new technologies to provide real-time information.

The changes will affect anyone who employs full-time staff, casual labour or pays family labour for working on the farm.

Culture change

Kenrick said the pain would come at the beginning as farmers underwent a culture change.

“There has been, among farmers particularly, a habit of going to accountants with retrospective information saying ‘I have been paying Johnny this much for the last six months will you please put that on the P35 for me at the end of the month'. That system is gone.

“The whole culture change will be no retrospective information, do it in real time, do it at the time you’re making the payment to the employee.”

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Changes to tax rules to affect farmers

Are you ready for the PAYE changes on the way?