Enhanced Reporting Requirements: What Irish Employers Need to Know

Under The Finance Act 2022, new Enhanced Reporting Requirements will come into effect on January 1st, 2024. As stipulated by Revenue, this Act will require employers to “report details of certain expenses and benefits made to employees and directors.”

To better explain the details of the new Enhanced Reporting Requirements, we’re going to assess the essential elements so you’re better prepared come the new year. 

 

From January 1st, 2024, employers who pay any of the following three non-taxable expenses/benefits to their employees and directors must report them to Revenue. These are:

• Small benefit exemption
• Remote working daily allowance
• Travel and subsistence

As mentioned, the Enhanced Reporting Requirements are part of Finance Act 2022. Known as Section 897C of the Taxes Consolidation Act 1997, it provides for mandatory real-time reporting of the above reportable benefits.

 

So, what information must be reported? To ensure you know the ins and outs, let’s explore the three non-taxable expenses/benefits listed above.

1. Small Benefit Exemption

As of January 1, 2025, the Small Benefit Exemption in Ireland allows employers to provide employees with up to five non-cash benefits per year, tax-free, with a combined value not exceeding €1,500. This enhancement, announced in Budget 2025, increases the previous limit of two benefits totaling €1,000.

Key points of the Small Benefit Exemption:

• Non-Cash Benefits: The benefits must be in forms other than cash, such as gift vouchers or tangible items. They cannot be redeemed for cash.
• Value Limit: The total value of the benefits provided within a year must not exceed €1,500. If the combined value surpasses this threshold, the entire amount becomes subject to tax.
• Number of Benefits: Employers can now offer up to five separate benefits per year under this exemption. Providing more than five benefits will result in the additional ones being taxable.
• Salary Sacrifice: The benefits must not be part of any salary sacrifice arrangement.
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These changes aim to provide greater flexibility for employers in rewarding employees while ensuring compliance with tax regulations. You must submit details of the date paid and the value of this benefit.

 

2. Remote Working Daily Allowance

If you pay a Remote Working daily allowance, you must report the following:

• Total number of days.
• Amount paid.
• Date paid.

 

3. Travel and Subsistence

You must submit the following Travel and subsistence items, including the date paid and the amount of each payment for:

• Travel vouched.
• Travel unvouched.
• Subsistence vouched.
• Subsistence unvouched.
• Site-based employees (including 'Country money').
• Emergency travel.
• Eating on site.

With regard to travel and subsistence, the Enhanced Reporting Requirements only apply to payments made to an employee.

Related Article: National Living Wage in Ireland: What Employers Need to Know

 

Revenue requires this information to:

• Enhance their Compliance Intervention Framework by directing resources away from compliant employers.
• Provide quality high-level data in support of effective and informed policy decisions by the Department of Finance.
• Increase visibility and assurance for employees in relation to non-taxable payments. Revenue will publish further information on this in due course.

 

As you can submit your expenses and benefits from January 1st, it’s best to get a head start on your reports now. 

Begin by reviewing the information required by Revenue and once you understand the Enhanced Reporting Requirements, collate the information. You may have to communicate with various teams to pull this all together, and if so, ensure everything is gathered in a concise manner. You should also assign someone to submit the reports to Revenue. If a third-party software provider is acting on your behalf, keep in touch with them. 

Taking these steps now will set you up for a smooth start to 2024, with one less employer obligation to worry about. 

 

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So, what are you waiting for? Book an outsourced payroll demo today or contact us to speak with a payroll specialist.