From January 1 next, all payments to employees must be recorded online as they happen

FARMERS who pay even small amounts of cash to employees on their farm (not contractors) will, from January 1, 2019, have to make online returns on those payments, if they want it to qualify as an expense on their farm accounts.

The move is part of a strategy by the Revenue Commissioners to ‘modernise’ all PAYE transactions, in a move that they say is designed to make it easier for employers and employees to ensure that the correct tax is deducted and paid on time.

Up until now, it was standard accounting practice on farms to submit an annual figure for casual labour, whether that be in relation to younger members of the farm family or ‘outsiders’ that they would employ casually in the course of the year.

This did not require a specific online return per person paid, but all that will change from January 1 next, when Revenue will introduce what is termed ‘Real Time Reporting’ (RTR).

RTR – or in simpler terms, ‘as it happens’ – will require the farmer to make an electronic return to Revenue every time an employee is paid out of the farm accounts. Accountants and the IFA have advised that this will be ‘a big change’ for many farmers.

Rosemary McDonagh, Galway IFA Farm Business, Services and Inputs Representative, told the Farming Tribune that farmers needed to be aware of this change that was coming down the track.

“This will represent a major change for many farmers who year-in, year-out would budget for a certain amount of money for casual labour.

“I want to make it clear that this does not apply to contractors who provide an invoice and receipts for the work they carry out, but it does apply to all other casual employees on the farm,” said Rosemary McDonagh.

For more, read this week’s Connacht Tribune.