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Revenue Guidance for Employers on Reportable Benefits

AUTHORs: Vahan Tchrakian co-author(s): Audrey Kean Services: Tax, Employment and Incentives Taxes DATE: 04/04/2023

Irish Revenue have recently issued an eBrief, and created a new tax and duty manual ("TDM"), on the mandatory reporting by employers of certain benefits that can be made without the deduction of tax (referred to as the 'reportable benefits').  The provision was introduced in Finance Act 2022, and the new TDM, in summary, reiterates that the measure is subject to a ministerial commencement order (to allow sufficient time for the implementing of a stakeholder consultation process) and signals an intent for the reporting to commence from the start of 2024.

The categories of reportable benefits are: (1) the remote working daily allowance of €3.20; (2) the payment of travel and subsistence expenses, and (3) the small benefit exemption.  Given the often sporadic and frequent nature of travel and subsistence expenses being reimbursed by employers on a tax-free basis, this category is likely to be the most administratively burdensome for employers (particularly large employers with significant workforces), and it will be important when the measures are introduced to accurately monitor non-taxable travel and subsistence payments to employees.

Reporting will be required on a monthly basis and will align with the standard payroll process under Real Time Reporting.  The TDM also refers to this as "the start of a phased introduction of additional reporting for employers in respect of the provision of other [non-taxable] benefits or payments", so this clearly signals that further categories of reportable benefits are expected to follow.  The introduction of the additional reporting reinforces Irish Revenue’s focus on obtaining real time data from employers in respect of employee benefits, emphasising the importance of the ongoing monitoring of these benefits.

The TDM states that comprehensive guidance will be issued in due course on the information to be reported, as well as the reporting options available to employers.

In respect of stakeholder engagement, the TDM states that Irish Revenue will work with stakeholders to determine a suitable manner of implementing the reporting of benefits to ensure the process is streamlined with employers’ current business processes. The stakeholders include employers, agents, representative bodies and software providers.