The 5 most common problems with PAYE Modernisation

PAYE Modernisation was officially implemented from 1st January 2019 and it is considered to be the most significant change in PAYE reporting since the 1960s. However, as with any significant reporting change, the implementation has been far from seamless. Here we detail the most common problems that payroll departments have been experiencing:

1. Revenue Payroll Notifications (RPN): RPNs have replaced the old P2C as the employee’s tax credit certificate. However, unlike their predecessor if the RPN used is incorrect or ‘old’ Revenue will reject the payroll report.
2. Incorrect Pay Dates: Revenue have recorded a large number of employers submitting payroll reports with the incorrect pay dates. Remember the report must be submitted before the employee is paid!
3. Employment IDs: The new system requires all employees to be issued with a unique employee ID. Where employment IDs are not correctly applied it may lead to two or more RPNs being issued for one individual, resulting in Revenue rejecting payroll reports.
4. Running Payroll in Advance: Running payroll in advance is no longer an option. Payroll must be reported in “real-time” with this new system.
5. Monthly Statements: The P30 has now been replaced by Monthly Statements which are statutory returns and are generated on the 5th of each month for the previous month. If you do not accept/amend the monthly statement by the 14th of the month, Revenue will deem you to have accepted the statement.

Overall the new reporting obligations on employers is tedious and time consuming, but now more than ever an employer’s compliance with payroll tax deductions is critical as non-compliance can lead to significant penalties, interest and fines. We offer a tailored payroll service to new and existing clients which is designed to overcome the common issues associated with PAYE Modernisation. Our Payroll service unlocks valuable time for our clients which allows them to focus on their business. Please get in touch if you would like to discuss availing of our Payroll service for your business.