Today we’re living longer and healthier lives than ever before! This is fantastic! Right? Well… sorry to be Captain Buzzkill, but as a nation, with this increase in life expectancy our saving habits haven’t caught up. Put simply, we’re not saving enough for our retirement! It’s no good having all those extra years if you haven’t even got enough to go to bingo with the girls every weekend.
Many people are planning on relying solely on their State pension, but this would lead to a serious decline in the standard of living. Never fear, however, the Irish government is here. To combat this issue, the State is bringing in an automatic enrolment system where all employers will be required to enrol their employees into a workplace pension scheme and contribute towards the employee’s pension pot.
The government has spent the last few years ironing out all the details and, hallelujah... the day is nigh. A date has finally been announced by the Department of Employment Affairs and Social Protection, and from 2022 pension auto enrolment will be rolled out on a phased basis.
Under this new system, an employee will be automatically enrolled into a pension scheme. It will apply to all employees aged between 23 and 60, earning more than €20,000 a year and not already in a workplace pension scheme. To begin with, the employee contribution will equal 1% of their salary, increasing to 6% of their salary in their tenth year of employment.
For employees, the best bit is that your employer will be required to contribute the same percentage, so after 6 years, workers and employers will be saving a combined 12% of salary into a pension. The State will then add a further 2% contribution which makes a whopping total of 14% of salary with a cap of €75,000. That will be more than enough to buy two double books and a couple of cans of Sprite at the bingo on weekends!
So how automatic is automatic? Well, as an employee, it’s completely automated. That’s the beauty. However, if you’re an employer, then you’ll likely have certain mandatory auto enrolment duties to complete. Such as:
Wow, that actually sounds like a lot of work I say as I wipe the sweat from my top lip. Not if you’re a Thesaurus Software customer! Thesaurus Payroll Manager is ahead of the auto enrolment curve and will automate all of these pesky auto enrolment tasks to ensure the transition is seamless. The best part is that they won’t charge you anything extra for any auto enrolment features.
Fun fact: Ireland is considered 1st in the EU when it comes to paying taxes!! Yes, I was just as shocked as you are! 1st in the EU at talking the ear off you and definitely 1st in the world at having the almighty craic, but paying taxes? Gosh not only are we funny and friendly, we’re honest and hardworking too! We’re so into our taxes and payroll that we are completely revolutionizing the way PAYE is reported to Revenue starting in the new year. When I say ‘we’, I mean it was the Irish government.
Yes that’s right folks I’m talking about PAYE Modernisation, the biggest (and best) change to PAYE since its introduction back in 1960. While, not everyone will agree, PAYE Modernisation will most definitely be a good thing for employers and employees. But today I want to talk about a very important certificate.
What are digital certificates? Revenue uses “digital certs” to allow business customers to electronically access their Revenue Online account and “sign and submit” their returns via the electronic channel (ROS). Essentially the process of electronically “signing and submitting” acts in lieu of a legal signature and ensures that the transactions and communications between business customers and Revenue cannot be repudiated at a later stage. It is also required by agents who wish to access online services for their clients.
Not only is this quite nifty, it is super secure. We're talking pinky promise between two grown men secure, that the information is locked down! And this security has been credited with the success of the digital certificates, and is possibly one of the key factors contributing to us paying our taxes so well.
But Aoibheann, digital certs have been around for ages, why the sudden interest? What else is going to make a comeback, bootleg jeans? Well digital certs are now a hot topic thanks to the introduction of PAYE Modernisation which came into effect on January 1st 2019. I’ve talked before about how you should be using payroll software in order to utilise it effectively, but equally as important is downloading your ROS digital certificate. Without this digital cert the PAYE Modernisation features in your software won’t work. You need to be able to access the ROS servers directly from your payroll software and likewise for the payroll information to be able to upload seamlessly to ROS from your computer.
The digital cert may sound scary but Thesaurus Software have put together a step by step guide on how to save and reload your digital certificates. It’s so simple, you wouldn't even need to get one of your grandkids to it for you.
Well, what are you waiting for? Get moving! So you can focus on real issues, like what to wear to bingo on Thursday.
Ah humans, we’re a lovely bunch aren’t we? An industrious lot some might say. Always finding ways to adapt, to evolve…...to manipulate. No matter what, if a situation exists where someone can be scammed, then get in line sweetie because there is already a slew of people that have beat you to it. It’s no different this time.
With the introduction of PAYE Modernisation a number of dodgy tax refund websites have sprung up left right and centre with the aim of conning you, yes YOU, out of your hard earned punts and pignins.
These sites basically offer to process tax refunds on your behalf and “all” they ask in return is 10% of the final amount of your rebate whilst also asking you to input your personal details such as your DOB, bank details, PPSN number, and so on. So never mind that this is a pretty bad deal already, the worst thing is that all they do is take the exact same information that you just typed in, and then type the exact same information into the Revenue website and charge you for the courtesy of doing so!
Daylight robbery doesn’t even cover it. The absolute CHEEK of it doesn’t even cover it either! People are needlessly giving these sites a cut of their tax refund, as well as their personal details….for nothing! Zilch. Zero. Nada!
Now I’ve known some amadán úfásachs in my life. There was a boy in my class, Séamus, who thought that teachers lived in the staff room and that chocolate milk came from brown cows. My own mother thought I was going to grow up to be a nice respectable young woman. HA! But giving someone online your details and money for nothing? Now that is just plain stupid. #sorrynotsorry
So what has this got to do with PAYE Modernisation? Where is my tax refund? How come I’ve never seen a baby pigeon? Well, under the new PAYE system, employers have to report employees’ pay and deductions each time they are paid instead of once a year. For anyone who is not properly registered under the PAYE system (for example, a foreign national newly arrived to Ireland) they will be put on emergency tax until they’re registered. This will most likely result in a surge of people claiming tax rebates throughout the year.
Now besides the sheer silliness of it all there is also a more insidious side to all this. I have a feeling the “STRANGER DANGER” of the current generation will be “do not give your bank details to someone who asks for it online”. Not only that, but with all the details you are required to enter they basically have everything they need to impersonate you online whenever they want.
There is also an additional risk that these companies will overstate expense estimates on your behalf in the hope of getting a bigger refund, thus a higher percentage of their cut. If you are later audited by Revenue and they found that you used one of these websites that supplied fake information on your behalf (even without your knowledge) then you, yes YOU, and not the company would be liable for interest and penalties.
Be safe, be savvy, be sassy. That’s my motto. (That, and “there’s always time for a chicken nugget”). Think twice before using these sites or, you know, just don’t! It’s really not that arduous to apply for a refund yourself so don’t be lazy; it will be one less headache to deal with.
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