Ireland | Employment Tax | Revenue’s Enhanced Benefits Reporting Regime

May 2023

Vialto Partners Ireland l Revenue’s Enhanced Benefits Reporting Regime

Background

During Budget 2023, the government announced changes to the reporting of certain payments to employees and / or directors. The payments affected by Phase 1 of the enhanced reporting requirements are:

• Travel and subsistence payments;
• Small benefits – vouchers;
• Tax-free employer contributions (up to €3.20 per day) towards Remote Working expenses.

The changes have been reflected in legislation but are subject to a commencement order (target commencement date is 1 January 2024).

We understand that Revenue expects that other benefits and payments may also be reported in later phases of this project but has not indicated what benefits / payments might be included.

What we know to date

Very little information on the mechanics of the reporting has been provided from Revenue to date, however, the following information has been confirmed:

• The reporting system to be used will build on the principles of PAYE Modernisation / Real Time Reporting.
• The benefits / payments will be required to be reported on or before the payment date.
• The information required to be reported is as follows:
  • Small benefit: The value of all small benefits paid to employees will have to be reported;
  • Remote Working daily allowance:  the number of days and amount paid will have to be reported;
  • Travel and subsistence: the amount of payments in relation to travel and subsistence (both vouched and unvouched), site based employees, emergency travel, and eating on site.
• Where there are multiple expense reimbursements throughout the month, a submission will be required for each expense run.
• Where an employer has a software system to manage payroll, it is expected that the payroll software will be able to report the required information directly to Revenue.
• If an employer does not have a software system for payroll purposes there will be a facility to upload the required information via ROS.
• It is understood that travel and subsistence payments made via a corporate credit card need not be reported as there is no reimbursement to the employee in such cases (the payment is made directly to the vendor).
• Revenue issued a survey to all employers earlier this year and the findings from that survey indicated a significant number of employers not using a software system to track expenses meaning that considerable work will be required by employers in order to prepare for these changes.
• Revenue have advised that there will be an “Enhanced Benefit Reporting” hub available on their website “soon” but a launch date has not been confirmed.

What does this mean for employers

Real time reporting of expense and benefit payments in essentially the same manner as payroll data is expected to enhance the depth, range and frequency of enquiries from Revenue regarding these payments.

Employers will need to review the current expense processes in place to ensure the reporting requirements can be met and consider streamlining these processes where necessary to avoid multiple reporting obligations in any month.

Employers will also need to consider how company credit cards are managed, particularly where the employee is required to submit an expense claim in cases where they are required to meet the credit card bill rather than the employer meeting the cost of the credit card directly, as this will give rise to a reporting obligation.

Employers will also need to be prepared for the expected expansion of the scope of these reporting obligations in the future and for the provision of any additional resources needed to meet their obligations.

Please reach out to your normal Vialto Partners contact or any of the below to discuss further:

Keith Connaughton, Partner | keith.connaughton@vialto.com

Aoife Reid, Partner | aoife.reid@vialto.com

Ian McCall, Partner | ian.mccall@vialto.com

Clara Flynn, Director | clara.flynn@vialto.com

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