In the ever-evolving landscape of tax regulations and compliance, staying ahead of the curve is essential for businesses of all sizes. The Finance Act 2022 introduced new Enhanced Reporting Requirements (ERR), which will affect how employers must report certain payments made to employees and directors from January 1, 2024.
In this blog post, we’ll delve into what these enhanced reporting requirements entail, what information you need to report, how to submit payment details to Revenue, and why this information is required. These submissions must be made by the employer either on or before the payment date to the employee.
What Information Do You Need to Report?
The first phase of reporting applies to payments falling under the following categories:
- Small Benefit Exemption: For payments provided to employees or directors, you must submit details of the date paid and the value of the benefit.
- Remote Working Daily Allowance: When providing a Remote Working daily allowance, report the total number of days, the amount paid, and the date paid.
- Travel and Subsistence: This category encompasses various types of payments, including travel vouched, travel unvouched, subsistence vouched, subsistence unvouched, site-based employees (including “Country money”), emergency travel, and eating on site.
For each of these payments, you must submit the date paid and the amount.
How Will You Submit Payment Details to Revenue?
Revenue Online Service (ROS) will be the platform through which employers manually submit their ERR details. Furthermore, continuous engagement with stakeholders has been a priority for Revenue in implementing this reporting requirement. Revenue initiated this engagement process in January, reaching out to all stakeholders to ensure their involvement and input.
Facilities for 3rd Party Software Providers
For employers who rely on third-party software providers for their payroll and reporting needs, it’s essential to ensure that your software provider is aware of these new reporting requirements. Revenue is actively engaging with third-party software providers to develop the necessary tools and integrations for seamless reporting. Employers should encourage their software providers to engage with Revenue in implementing these changes effectively.
Why Is This Information Required?
The introduction of Enhanced Reporting Requirements serves several critical purposes:
- Enhanced Compliance: ERR will allow Revenue to focus its resources on non-compliant employers, directing efforts where they are needed most.
- Informed Policy Decisions: High-quality data collected through ERR will support effective and informed policy decisions by the Department of Finance, ensuring that tax policies remain fair and equitable.
- Employee Assurance: ERR will increase transparency and assurance for employees regarding non-taxable payments, fostering trust in the tax system.
Conclusion
As we approach the implementation of Enhanced Reporting Requirements on January 1, 2024, it is imperative for employers to prepare for these changes. Staying informed and working closely with your accountancy firm will help ensure a smooth transition to correctly comply with these new regulations. At Keogh Accountancy Group, we are committed to assisting our clients in navigating these changes seamlessly. If you have any questions or need further guidance on how to meet your tax requirements effectively, please don’t hesitate to reach out to our experienced team.