Not paying PAYE

Hi,

I changed jobs in July this year as the new job meant I was working 5 minutes from home instead of an hour from home.

My salary dropped from 43k to 40k per annum.

However I checked my what I have been paid by the new company per month and it was amounted to 3013 each month.

It looks like Im not paying PAYE at the moment, I am paying PRSI and Income Levy.

I am a single parent so I know I have extra tax credits but surely I should still be paying PAYE.

Can anyone offer some advice?

Thanks

Hi
On the face of it you should be paying PAYE. However as you have had a reduction in salary you may have already paid enough tax already for this year. You should have had communications from the Tax office ie a new tax credit cert when you changed employment. What you could do is contact the tax office and check that you are registered as an employee of your new employer and follow their advice. In the new year you should get a tax review for 2010.

Why not not just ask the person who does your payroll? Do you get payslips?

i have asked payroll here and it seems that my P45 from my last employment was not sent correctly to the tax office, so I was showing on the system as being tax free. The result of this is that I will now have to pay 2k in tax in December leaving me with 1k in my wages. Not a great situation given that it's 5 weeks between getting paid in December and January. I feel dissapointed that this was not spotted sooner by both myself and the payroll dept here. Before we receive our payslips in my current job they are checked and signed off by 2 people and neither of them spotted it either.

You could ask payroll to leave it the way it is and you will sort it out yourself in 2011 by sending in a tax return. Revenue will probably spread the underpayment over a number of years if you ask them.

Payroll are not supposed to do this but sometimes in a small company they might be more accomodating

You can download my Excel calculator to have as a reference for future such queries:

http://taxcalc.eu/monthlyss/

According to its calculations, you would likely have been netting approx €2940 prior to July and should have been netting €2820 (both figures might vary depending on your precise tax credits and standard band).

Hi

My company did say they would pay the 2k for me but I would have to pay them back approx €450 per month. I dont feel comfortable owing the company money especially as my 6 month review is coming up plus the big end of year review is also coming up!. The most annoying thing about all of this is that I had just started to get my head around saving some money so I actually do have 2k saved that I could use to survive over the 5 week period when Ill be down money.

As someone with experience of these situations I'd say you should ask the payroll dept to contact the tax office and ask if it would be possible to have a tax credit cert issued on a week 1 / month 1 basis up to the end of the year.

Revenue should be accomodating, seeing as the problem arose as a result of an incorrect P2C issuing to your new employer from Revenue. You should suggest to the payroll dept. that they do it this way, and let them speak to Revenue: as strictly speaking they shouldn't be doing what they said they will about the 2k of tax.

That way your employer can correctly operate the PAYE system, and still pay you your "normal" salary, and you can then agree to have your tax credits for the next couple of years reduced to cover the underpayment that's arisen.

If you are willing to pay it in full, I can't see the company having any problem. We had a few cases like this and asking the employee to pay over time was more to accommodate them. If someone was willing to pay it in one lump sum it was always allowed.

Getting a new tax cert at this time of year could be tricky as we near the end of the tax year. I also presume they are now working on next years.

The last payroll may have run also- our last pay run is running toward the end of this week.

Hi all, thanks for the feedback. I think I'm just going to have the 2k deducted from my December salary. I wouldn't feel right owing either the company or revenue money!! I know I'll have very little in my next pay but at least I'll start the new year afresh and I can build up my savings again.