Workers unexpectedly falling into emergency tax exceed 28,500

Some employers operating emergency tax regime unnecessarily, Revenue says

As of January 1st, employers across the State have been obliged to comply with PAYE modernisation rules. Photograph: Nick Bradshaw

As of January 1st, employers across the State have been obliged to comply with PAYE modernisation rules. Photograph: Nick Bradshaw


At least 28,500 employees have received less than half of their gross pay so far this month because of changes to Revenue’s reporting systems, with some employers unnecessarily putting staff on an emergency tax regime.

The problems could occur where an employee’s PAYE records are not entirely up to date, for example where they have taken on a second job but their tax details have not been adjusted to reflect this.

Under a modernisation of its PAYE systems, Revenue required employers to submit a list of their employees with their details by the end of October last. Revenue said that so far, details for more than 1.9 million individuals have been reported, with emergency tax of 51 per cent applied to 28,500 employees.

The Association of Chartered Certified Accountants (ACCA) expected that this number be as high as 120,000 this month – however that is unlikely now.

Revenue’s analysis of the figures confirmed that many employers who incorrectly operated emergency tax in their first payroll run of the year have since corrected the error and applied the correct details to their employees earnings.

Emergency tax

Reasons for applying emergency tax include where an employee does not provide their employer with a personal public service number (PPSN), a person taking up their first-ever employment in the State, or where an employee’s details need to be updated.

The tax authority said it is “actively monitoring PAYE modernisation payroll submissions and will make direct contact with employers who appear not to be operating the system properly”.

“We also expect that the numbers of employees being placed on emergency tax will decrease further once the system beds down and employers become used to operating on a real-time basis,” a spokesman said.

As of January 1st, employers across the State were obliged to comply with the new rules, which involved the most significant reform of the system since its introduction in 1960.

Prior to the changes, employers logged payroll returns containing details of each employee’s tax and pay with Revenue once a year on a P35 return.

Revenue advises that any employees affected should log in to their online account to confirm their tax credit certificate for 2019 is correct. Any changes needed can be made online.

The new measure is expected to boost Revenue’s tax take by about €50 million a year.