Revenue Note for Guidance

986 Regulations

Summary

This section empowers the Revenue Commissioners to make regulations in respect of the assessment, charge, collection and recovery of income tax under the PAYE system. The Income Tax (Employments) (Consolidated) Regulations, 2001 (S.I. No. 559 of 2001), are currently in force.

Details

(1) Regulations are to be made by the Revenue Commissioners in regard to the assessment, collection and recovery of income tax under the PAYE system. The regulations may include provision —

for requiring an employer on making any payment of emoluments to deduct or repay tax based on the rate(s) of tax, allowances, deductions and reliefs which are set out on the tax deduction card;
for making the person, who is required to make a tax deduction, accountable for the tax and liable to pay it to the Revenue Commissioners and, when such a person is required to make a repayment, for credit to be given for the repayment only when the repayment has been made;
for the inspection by the Revenue Commissioners of wages sheets and other documents to ensure that the PAYE system is properly operated;
for the collection and recovery of tax which has not been recovered during the year;
for appeals against matters in the regulations and for which there is no other appeal procedure;
for the deduction of tax at the standard rate and higher rate, as appropriate;
for the reduction of emoluments by any occupational pension scheme contributions, qualifying premiums under an approved annuity contract (RAC), contributions to a personal retirement savings account (PRSA) or contributions to permanent health benefit schemes before making a deduction or repayment of tax;
for requiring an employer to notify the Revenue Commissioners where an employment exists and to register for PAYE when an employee’s emoluments exceed the relevant threshold;
for requiring an employer to keep and maintain a register of employees for delivery to the Revenue Commissioners, as and when required, when the emoluments paid exceed the relevant threshold;
for treating some persons, who are not employers, as employers as required.

for the collection and recovery of tax on non-PAYE income through the PAYE system;

for the collection of tax from the employee rather than the employer in certain circumstances, where the employer has failed to deduct tax;

requiring an employer to submit details of emoluments paid and tax deducted and other relevant information to the Revenue Commissioners in such manner and form as they may approve or prescribe;

for the development of an electronic system to administer the PAYE system and to cater for communication and interaction between Revenue, employers and employees on a more automated electronic basis;

for requiring an employer who makes a payment to an employee to notify the Revenue Commissioners within a period of time specified in the regulations.

(2) The regulations made under this section apply regardless of anything in the Income Tax Acts but taxpayers’ other rights of appeal are not affected.

(3) Tax deduction cards should be prepared with a view to securing that in so far as is practicable the total estimated tax payable in respect of emoluments for the year of assessment (after allowing a provisional deduction for allowances and reliefs and taking into account any overcharge or undercharge for previous years) is deducted from emoluments paid in the year.

(4) The amounts in respect of reliefs from income tax to be stated in a tax deduction card may be rounded up to a convenient greater amount. Any tax which is not deducted for a year of assessment as a result of such rounding up may be recovered in the following year of assessment.

(5) Employers must register for PAYE purposes where the emoluments of an employee exceed €8 per week (or €36 a month) for full-time employees, or €2 a week (or €9 a month) where the employee has other employment. In effect, these limits mean that every employer must register for PAYE purposes.

(6) The registration limits are relaxed for an employer who has only one domestic employee employed in his/her own home. The threshold in such a case is increased to €40 a week.

(6A) If the Revenue Commissioners are satisfied that it is un-necessary or not appropriate for an employer to comply with any of the PAYE regulations a notification to that effect may be issued to the employer in such circumstances.

(7) The regulations made under this section must be laid before Dáil Éireann.

Relevant Date: Finance Act 2019