Brendan Griffin (Kerry, Fine Gael)
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80. To ask the Minister for Finance the number of staff reductions and savings that will be made following the introduction of the new computer-based employee PRSI return being introduced from January 2019; and if he will make a statement on the matter. [40432/18]

Paschal Donohoe (Dublin Central, Fine Gael)
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It is assumed that the Deputy is referring to the introduction of PAYE Modernisation which was announced as part of Budget 2017.

By way of background information, the PAYE system brings in almost €1 billion every month to the Exchequer. There are approximately 200,000 registered employers and around 2.3 million employees with a significant number of these having more than one employment. The nature of the current PAYE system is such that it gives rise to a high number of contacts from taxpayers throughout the year. For example, Revenue’s Employee Helpline handled around 1.3 million telephone calls in 2017 and a significant amount of Revenue’s staff resources are deployed to handle these calls.

The PAYE Modernisation programme represents the most significant change to the PAYE system since its introduction more than fifty years ago. At the heart of the programme is the new real-time reporting requirement to Revenue for employers in respect of employee income and statutory deductions, including income tax, PRSI, USC and Local Property Tax, which must be completed with each payroll run. There will be no change to the actual payment dates and as such no cash-flow implications for employers.

Once the system goes live on 1 January 2019 it will bring improved accuracy and transparency for all stakeholders, including employers, employees and Revenue and will also significantly streamline the entire administrative process. To ensure optimum benefits, Revenue has worked extensively with all relevant stakeholders over the past two years in a co-design approach. This has included employers, representative bodies and the payroll industry to ensure the new reporting system successfully delivers these benefits while also reducing the administrative burden to the greatest extent possible.

For example, from 1 January 2019, the PAYE reporting process will be significantly simplified by the elimination of the various forms (e.g. P30, P45, P46, P35, P60,) that must currently be completed while also ensuring that employee tax deductions and other contributions are accurately reflected. As every employer will be required to provide information on employees’ pay and statutory deductions each time they pay their employees, Revenue will have the most up to date pay and deductions details available to it, which will be of major assistance in ensuring that taxpayers benefit fully from their various credits and entitlements. Also, for the first time, employees will be able to view the information reported to Revenue on their behalf by employers.

It is too early to identify any staff savings that will accrue from the new system. Revenue has advised me that its initial focus will be on supporting employers to meet the new obligations arising from PAYE Modernisation and to assist employees on an individual basis where necessary. Once the system is successfully implemented, Revenue will reassign any staff available at that point to other priority work, including compliance activity.

The issue of resources for the administration of Pay Related Social Insurance is a matter for my colleague, the Minister for Employment Affairs and Social Protection.