Written answers

Tuesday, 26 February 2019

Department of Education and Skills

Tax Code

Photo of Thomas ByrneThomas Byrne (Meath East, Fianna Fail)
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161. To ask the Minister for Education and Skills the steps he has taken to communicate with substitute teachers regarding the pay and tax issue; and when he expects to have the matter resolved. [8971/19]

Photo of Joe McHughJoe McHugh (Donegal, Fine Gael)
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My Department issues salary and pension payments to approximately 120,000 payees a fortnight on four payrolls: primary teachers, post primary teachers, non-teaching staff and retired teachers, spouses and children.

The Revenue Commissioners have introduced real time PAYE (PAYE modernisation) which went live on the 1stJanuary 2019. This was the biggest change to the PAYE system since the1960s. From the 1 January 2019, employers are required to report their employees’ pay and statutory deductions to Revenue for each payroll issue.

The issue related to the taxation of the substitute staff and is confined to those who were paid in the first three payrolls of 2019 – payment issue dates of the 3rd, 10thand 17thJanuary. A cessation date was included in the payroll files sent to Revenue on the

3rdand 17thJanuary for post primary substitute teachers and on 10thJanuary for primary and non-teaching staff. The new Revenue system updated the employees’ records immediately and assigned zero credits to them which meant that when they were next paid, for some substitutes, there were no tax credits available to be applied to the salary.

The payroll software was amended in mid-January to prevent an end date transferring to Revenue for future payments. This meant that any substitute staff paid for the first time in 2019 after the 17thJanuary do not have problems with tax credits.

However this software amendment did not correct the issues that arose for the staff who were paid already in the first three payrolls of 2019.

My Department and Revenue accorded the highest priority towards a correction of the tax issues for those substitute staff impacted in the first three payrolls and refunds have now issued to 69 post primary payees, 533 primary payees and 177 non teaching staff payees. The refunds range in value from €0.24 to €1,281.71.

Approximately 600 additional refunds will be issued through the post primary payroll this week ( 28thFebruary).

My Department is also making arrangements to ensure that refunds, where due, are generated for those that have not worked since the payrolls issued in January.

Substitute staff experiencing financial hardship can contact my Department and seek a letter that they can submit to financial institutions. The letter will give background details on the issue. My Department is responding to emails being received and has three dedicated email addresses that are being monitored for substitute staff with queries. There are also dedicated phone lines for substitute staff to contact my Department.

Where a substitute teacher/non-teaching staff member has more than one employer, the Revenue Commissioners will issue Revenue Payroll Notifications (RPNs) based on the information available to them. Employees may have more than one source of taxable income and may assign credits to more than one employment. Tax credits and taxable basis are decided by Revenue and notified to the employer to apply to payrolls. Any refunds of tax to staff are based on the information supplied by Revenue.


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