24th January 2018 | For more information visit https://www.thesaurus.ie Under the new legislation, whenever Irish employers pay their employees, a file must be submitted (electronically) to Revenue containing details of these payments. The contents of this file will be similar to the details currently submitted in the annual P35, however, unlike the annual P35, this file must be submitted each pay period. Therefore, in most cases, the submission will be made either weekly or monthly. This real time information will enable Revenue to ensure that employees are receiving their correct credits and cut off points. This in turn should mean that the incidence of year end over/underpayments of income tax will be substantially reduced. We have designed a webinar to explain the ins and outs of what PAYE Modernisation means for your business and your payroll processing. Agenda An introduction to PAYE Modernisation including recent changes What direct effect will this have on employers? What direct effect will this have on employees? What are the possible downsides for employers? Revenue’s delivery schedule The role out of PAYE Modernisation in the UK Processing manually or using payroll software? The Panel: Main presenter: Paul Byrne Guest presenter: Sinead Sweeney Guest Panelist: Sandra Clarke

1. 1/24/18
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The webinar will begin shortly….
How will PAYE Modernisation affect
your payroll processing?
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Q&A Session
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Q&A
On Demand
This session is being recorded
REC
The Panel…
Paul Byrne
Managing Director at
Thesaurus Software
Former Accountant
in Practice
Sandra Clarke
Partner at
BCC Accountants
Council Member of the
Irish Tax Institute
Sinead Sweeney
PAYE Modernisation
Change Manager
Revenue
Commissioners
Webinar Agenda…
An introduction to
PAYE Modernisation
What direct effect
will this have on
employers?
What direct effect
will this have on
employees?
What are the
possible downsides
for employers?
Revenue’s delivery
schedule
The rollout of PAYE
Modernisation in
the UK
Processing manually
or using payroll
software?
Part 1: How will PAYE Modernisation affect your payroll processing?
Part 2: Revenue Presentation
Questions and Answers

2. 1/24/18
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--An Introduction to PAYE Modernisation
What is PAYE Modernisation?
• Many employees are given the wrong tax credits and cut-off points
• Why? Revenue only gets payroll data at the end of each year (P35)
• Revenue will know where the employee is working and how much
they are earning in real time
• This allows Revenue to allocate the correct credits, avoiding
overpayments / underpayments of tax
What is PAYE Modernisation?
• Employers not operating PAYE correctly – new employees not
registered & out of date tax credits being used
• With PAYE Modernisation, a file will be submitted electronically to
Revenue on or before or shortly after each pay run
• Retrieval of tax credits will be automated – ensuring the correct
credits are being used
No more ‘P’ forms
• P60s
• P45s and P46s
• P35s
• P30s

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The file specifications…
• RPN – Revenue Payroll Notification – used to retrieve tax credits
and cut off points for new and existing employees
• http://bit.ly/2Bb1UEp
• PSR – Payroll Submission Request (Mini P35) – used to submit
payroll data to Revenue each pay period
• http://bit.ly/2FN5xUA
The file specifications…
• RPN Data Items:
1. Illness Benefit
• Illness Benefit will not be included due to data protection concerns
• Tax credits and cut off points will be adjusted by Revenue for any taxable
illness benefit
• Payroll operators will no longer need to worry about taxing Illness Benefit
• This change applies from 1st January 2018
The file specifications…
• RPN Data Items:
2. Employment ID
• Only relevant for those employees who have multiple employments with
the same employer, and those employees who cease with an employer
and are then re-employed by the same employer in the same tax year
• Distinguishes employments from each other so as to ensure that the
employee’s tax credits and cut offs are allocated correctly
• Payroll software will handle this in the background
The file specifications…
• PSR Data Items:
1. RPN Number
• The RPN response will have an RPN number, which will also be included in
the periodic PSR
• The RPN number in the PSR will show Revenue that the employer is
applying the correct tax credits and cut offs for the employees.

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The file specifications…
• PSR Data Items:
2. Gross Medical Insurance paid by employer
• The current P35 spec looks for the amount of medical insurance eligible
for tax relief, which must be obtained from the medical insurance provider
• The PSR specification is only looking for the actual amount paid by the
employer (the amount BIKable)
The file specifications…
• PSR Data Items:
3. Expected number of pay periods in a full year
• From 2019, the software and employer will need to know from the start
of the year how many pay days there are
• If there are 53, then the year’s tax credits and cut offs may be spread
over the 53 weeks
• Additional €100 million for the government???
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What direct effect will this
have on employers?
• Instead of a yearly P35, there will be a “mini P35” submitted with
each payroll run
• Checking for updated tax credits and cut off points will also be an
integral part of each payroll run
• Details of employees starting and employees leaving will be
included in the “mini P35”
What direct effect will this have on employers?

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• Businesses across Ireland have broadly welcomed PAYE
Modernisation
• Streamline business processes and reduce administrative cost
for employers
What direct effect will this have on employers?
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What direct effect will this
have on employees?
• Employees will be able to log in to Revenue (MyAccount) and view
what has been submitted, in relation to them, by the employer
• Employees will be able to allocate their credits and cut offs
between multiple employments
• Revenue can be informed of changes in employment
• At the year end, employees will be able to view and print their
official certificate of earnings and deductions
What direct effect will this have on employees?
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What are the possible
downsides for employers?

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• Administrative burden? Limited or no access to internet
connection
• Employers should invest in a payroll solution that will cater for
PAYE Modernisation
• The time saving benefits of payroll software should outweigh the
financial investment
Possible downsides? APIs and how they help…
• API: Application Programming Interface
• Enables different software applications to communicate with each
other, resulting in a better user experience
• Current system of retrieving tax credits (P2Cs) – manual process
with a number of steps
APIs and how they help…
• With the API, tax credit retrieval will require just one click
• Periodic payroll submissions (Mini P35) will also be a one click
process
• Overall, the actual workload required each pay period should be
reduced
APIs and how they help…
Enter details of new employees in to the payroll
Enter pay, hours and deductions for all employees
Retrieve latest P2C information – API
Process and finalise payroll
Submit file to Revenue - API
Distribute payslips and pay employees

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-Revenue’s Delivery Schedule
Revenue’s Delivery Schedule
• File specifications were agreed and published for:
• P2C request (now called RPN – Revenue Payroll Notification)
• Payroll Submission Request (i.e. the mini P35)
Revenue’s Delivery Schedule
• Next step: test environment which will allow Revenue and
Developers to test file submissions
• As developers, software changes need to be finished before next
Budget
• After this, the focus will be on changes as a result of the 2019 Budget
• Early 2019 – old and new systems will overlap as 2018 P35s will still
need to be submitted
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The rollout of PAYE
Modernisation in the UK

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BrightPay UK Demo…
Retrieval of coding notices (RPN)
Finalise the payroll
Submit an FPS & receive a response (PSR) – mini P35
-Submission Deadlines and Corrections
Submission Deadlines and Corrections
• In the UK, the periodic data submission must be submitted on or
before the actual pay day
• In Ireland, the recent Finance Act specified that the periodic data
submission will also be required on or before the actual pay date
• Best practice – submit after finalising each payroll
Submission Deadlines and Corrections
• Corrections can be made for incorrect submissions
• If the correction means that more tax is payable for a previous tax
month, Revenue can apply interest
• A correction after the month’s close off or sign off date will be
seen as a change to a statutory declaration
• Consistent corrections or late submissions may result in corrective
action by Revenue

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Submission Deadlines and Corrections
• Corrections are dealt with on the basis of “follow the money”
• If an employee is over or underpaid in a period and their pay is
adjusted in the next period to correct this, no correction
submission is required
• If an employee is paid an amount different to what it says in the
payroll, then a correction submission will subsequently be required
Data Alignment & Disputed Liabilities
• Data Alignment: 2018 Payroll software will prepare a return for
submitting electronically to Revenue so that Revenue will have
accurate information for the start of 2019
• Disputed Liabilities: One of the main difficulties with the UK system
is reconciling differences between HMRC and payroll systems
• Revenue will have a facility to perform a reconciliation between
both sets of data
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Processing Manually or using
Payroll Software?
Manual payroll processing…
208,000
Irish Employers
60,000
Calculate manually
• Need to log in to ROS and enter all details for all employees
• Need to manually check for and process changes to tax credits/cut offs
• Quite time consuming & prone to error
• Payroll bureau or payroll software?

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Why you need to get things right!
• Employees will expect to see most recent payments in their
MyAccount
• Late submissions will lead to the risk of penalties and fines
• A constant pattern of correction submissions will give rise to
interest and/or penalties
• Revenue will know when RPN checking and processing is not
happening
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OFF
Webinar50
Employer Licence
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Sinead Sweeney
PAYE Modernisation Change Manager
at Revenue Commissioners

11. 1/24/18
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