Why should a company outsource their payroll function?
Payroll outsourcing can work for any type of business as it helps reduce costs, add expertise and ensures contingency, confidentiality and peace of mind – so important for something as “mission critical” as payroll. The service needs to be customised to each client’s needs and the security of information being transmitted to be processed by the outsourcing company is critical.
Support for employers
Many employers do not realise the cost of an employee until the annual P35 tax return is filed with Revenue. This is the annual return for payroll taxes which have been deducted during the year.
We at Charles Crowley & Co can help reduce this tax burden by explaining and minimising the costs in advance. For example net to gross projections will allow the employer to see and understand the future costs of employing a particular employee. This information will assist the employer in budgeting for the coming tax year.
It is of vital importance that if an employer is paying an employee a net wage, the employee’s tax credits and rate band are correctly and fully allocated. For example, an employer taking on a new employee may formalise an agreement based on a net wage, however the employee, may not have allocated their full credits and rate band point to their new employer. If this is not done it could cost the employer an unnecessary tax cost.
The main tax deductions an employer must make from an employee’s wages is as follows: PAYE, USC and PRSI. An employee’s and employer’s contribution of PRSI is paid (unless exempt), which will depend on the employee’s gross earnings. Tax will be deducted according to the employee’s tax credits, rate band and USC rates as instructed by the Revenue.
Standard USC rates for 2015 are as follows:
• Income up to €12,012.00 USC paid at 1.5%
• Income from €12,012.00 to €17,576.00 paid at 3.5%
• Income from €17,576 to €70,044 paid at 7%
• Income above €70,044 paid at 8%
- There are also reduced rates and thresholds for USC, many may also be exempt from USC again this will depend on the individual circumstances of the employee.
Standard rate bands for 2015 are as follows:
• Single, widowed or a surviving civil partner without qualifying children:
33,800 @ 20% balance @ 40%
• Single, widowed or a surviving civil partner without qualifying for single person child carer credit: 37,800 @ 20% balance @ 40%
• Married or in a civil partnership (one spouse or civil partner with income): 42,800 @ 20% balance @ 40%
• Married or in a civil partnership (both spouses and civil partnerships with income): 42,800 @ 20% (with an increase of 24,800 max) balance @ 40%.
PAYE is deducted as a percentage of earnings according to the individual’s rate band as assigned by Revenue.
- The rate band can also be transferable between spouses, it is more tax efficient to transfer a portion of rate band to the spouse who has the highest income so that the tax liability can be reduced.
- Information is transferred to us securely and we look after the rest. We take care of all the calculations, provide payslips for your employees and file your Revenue returns.
Our Payroll Outsourcing Service
At Charles Crowley & Co we have been providing payroll outsourcing services to our clients for the last thirty years. Payroll can be very demanding and time consuming for employers. Our service allows employers to focus on other more pressing business priorities. Here are the six main advantages of choosing this service:
1.It saves time and money for the employer due to efficient payroll systems and procedures.
2.Ensures that legislation and budget changes are constantly updated.
3. Tax remittances are made on time thus avoiding late penalties and interest charges.
4. The employee’s records are kept up to date and secure.
5. Additional services such as employee entitlements i.e. holidays, bank holidays, maternity benefit etc.
6. Our service eliminates the need for your company to acquire payroll software, licences, support and on-going training.
For a free quote or to find out more email charles@charlespcrowley.com or call 023-8841899 or from outside Ireland call 00353 23 8841899.
