Pay As You Earn (PAYE) Introduction Applies to Schedule E income

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Presentation transcript:

Pay As You Earn (PAYE) Introduction Applies to Schedule E income Employers are obliged to deduct income tax, PRSI and USC from payments to employees Deducted from each payment whether paid weekly or monthly Employer must be registered with Revenue Individuals are registered as employees of the employer

Pay As You Earn (PAYE) Employer’s obligations Register as an employer with Revenue Make deductions from employees pay and benefits Pay this tax (and other deductions) to Revenue

Pay As You Earn (PAYE) Employee’s obligations Inform Revenue of an employment and receive a Certificate of Tax Credits and Standard Rate Band Form 12A is completed if commencing employment in Ireland for the first time Providing a P45 to the new employer

Pay As You Earn (PAYE) Certificate of Tax Credits Employee receives a detailed copy Employer receives a CTC just with total amounts for Tax Credits and Standard Rate Cut off Point Employer uses the information to apply the deductions

Pay As You Earn (PAYE) Calculation of Tax under PAYE Calculation made using CTC and tax rates applicable at the time of the payment Taxable Income, includes: Monetary payments BIKs and perks Less pension contributions Less PHI contributions

Pay As You Earn (PAYE) Methods of Calculation Cumulative Basis Week 1/ Month 1 Basis Emergency Basis

Pay As You Earn (PAYE) PAYE administration P30 P35/P35L P60 P45