New payroll legislation for 2019 tax year

With Sage Business Cloud Payroll, you can be confident that your service is always up to date with the latest legislation. It automatically updates with the legislation changes announced in the Budget Statement.

Emergency tax

From 1 January 2019, there is an increase of €750.00 in the income tax standard rate band for all earners.

This affects the cut off point for Emergency tax as follows:

Length of time on Emergency tax status Tax rate 1 cut-off point
Month 1, or weeks 1 to 4 2942.00 monthly, or 679.00 weekly
Month 2, or weeks 5 to 8 0.00
Month 3, or week 9 onwards 0.00

If an employee doesn’t have a PPS number, they must pay the higher rate of tax (40%) on all of their taxable earnings in a period.

Universal social charge (USC)

The following rates and thresholds apply from 1 January 2019:

Rate Earnings
0.5% 0.01 – 12,012.00
2% 12,012.01 – 19,874.00
4.5% 19,874.01 and 70,044.00
8% 70,044.00 and above

Employees aged 70 or older, and medical card holders are exempt from paying USC at rates 5% and 8%. If your employees earn less than €13,000 in the year, they’re exempt from USC.

Increase in minimum wage rate

From 1 January 2019, the minimum wage rate increases to €9.80 per hour.

Revenue Payroll Notifications (RPNs) replacing P2C certificates

From 1 January 2019, you’ll be required to request the most up to date RPNs for your employees before you process their pay details each pay run. RPNs provide you with the necessary information to deduct from your employees the correct tax, universal social charge (USC) and local property tax (LPT), if applicable.

RPNs will be made available to you, for each employee that is currently registered with Revenue as working for your company, before 1 January 2019. When you move into your first pay run of 2019, the Retrieve RPNs functionality is automatically switched on in your Sage Business Cloud Payroll service.

P45, P46, P45 (Part 3), P30 and P35 returns no longer valid from 2019

From 1 January 2019, the traditional reporting structure that businesses used in 2018 and previous years (such as P30, P35 and P45) ceases to exist. Instead under the new Real Time Reporting (RTR) legislation, you must send a payroll submission electronically to Revenue each time you pay your employees. You can do this quickly and easily in Sage Business Cloud Payroll whenever you complete a pay run in 2019.

The payroll submission you make each pay run to Revenue contains:

  • Details of all payments made to your employees in the pay run.
  • The total tax, universal social charge (USC), pay related social insurance (PRSI), and if applicable local property tax (LPT) paid by your employees in the pay run.
  • Employee details, such as name, PPS number, Employment ID and tax/USC status.
  • Details of any starters or leavers from the pay run, and more information.

All payroll submissions sent by you to Revenue in respect of a month will form the basis of a statement that will be provided to you by Revenue outlining your PAYE liabilities for that month.