Q&A: What is happening with the PAYE tax system?

The Revenue Commissioners has spent the past two years preparing what it is describing as the most significant reform of the Pay As You Earn (PAYE) system since it was first introduced in 1960.

Since January 1st, 2019, employers and pension providers have been reporting details of employees’ and pension recipients’ pay and statutory deductions to Revenue every time they have been paid.

The reform of the system, and in particular the receipt of real time payroll information, has enabled Revenue to provide extended online services to taxpayers. This will mean much of the paperwork associated with paying income tax will disappear.

Okay, so what has actually changed?

Well, for a start, there are no more P45s. If you leave a job, your employer will no longer issue you with the document. Instead, they will enter your leaving date when submitting details of their final pay and deductions to Revenue.

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You can view details of your ceased employment in the MyAccount section on Revenue’s website. This is done by clicking on ‘Manage Your Tax’ on the ‘PAYE Services’ card and clicking on ‘View’ beside the job listed.

Is the P60 gone as well?

Yes. As employers send Revenue details of pay, tax and other statutory deductions for each employee or pension recipient every time they get paid, they won’t be issuing P60s at the end of the year anymore.

Instead, Revenue will provide you with an Employment Detail Summary online, which replaces the P60.

A 2019 Employment Detail Summary is now available in MyAccount and contains your income and deductions details for the year, as reported to Revenue by your employer.

The information can be used in the same manner as the P60, for example, as proof of income to a third party.

Once logged into MyAccount, this service can be accessed by clicking ‘Review Your Tax’ on the ‘PAYE Services’ card. It will be listed under the tax year 2019. So far, more than 24,000 Employment Detail Summaries have been created for 2019.

What about my pay and tax details?

You can also use MyAccount to view those details, as reported to Revenue. Once logged in, the service can be accessed by clicking ‘Manage Your Tax 2020’ on the ‘PAYE Services’ card and clicking on ‘View’ beside the job listed. So far, more than 191,000 PAYE taxpayers have used it.

What if I dispute any of the figures?

If you have any queries regarding the figures reported, you should contact your employer in the first instance. If you continue to have concerns, you can contact Revenue through its online enquiry facility, MyEnquiries.

That all sounds good. But what if I want to claim a refund for 2019?

Your 2019 income tax return is now available in myAccount. By completing an income tax return you can change existing credits/declared income; declare additional income; and claim additional credits/reliefs, such as for health expenses.

If you log into MyAccount, you can file a return by clicking ‘Review Your Tax’ on the ‘PAYE Services’ card and then clicking ‘Request’ beside ‘Statement of Liability’, which will be listed under the tax year 2019.

So far, more than 54,000 taxpayers have filed an income tax return for last year.