Introduction
- The Pay As You Earn (PAYE) system
- Brief outline to this Guide
- Income tax calendar
- PAYE forms
- Determining the employment status of an individual
- Assistance to employers
1. The Pay As You Earn (PAYE) system
The Pay As You Earn (PAYE) system is a method of tax deduction under which an employer calculates and deducts any income tax due each time a payment of wages, salary etc. is made to an employee.
In addition, employers are obliged to calculate and deduct any liability to Pay Related Social Insurance (PRSI) and income levies.
References to PRSI in this guide may be taken to include income levies in force, where appropriate.
Employers are obliged to operate the PAYE system where they make payments in excess of certain levels (see registration of employers for paye purposes part 1).
2. Brief outline to this Guide
This Guide sets out for employers the requirements of the PAYE system and is also intended to assist them on special PAYE problems that may not be covered in the instructions printed on the various forms.
Section 1 to 9 describe the system, define "pay" for PAYE purposes and sets out the normal procedures to be followed.
Section 10 sets out the employer's duties before the new tax year commences.
Section 11 explains the procedures for dealing with new employees and recommencing employees.
Section 12 deals with employment cessations and related topics.
Section 13 deals with Pay Related Social Insurance (PRSI).
Section 14 is concerned with payment of tax and PRSI contributions to the Collector General.
Section 15 sets out the employer's duties at the end of the tax year.
Section 16 deals with the Revenue On-Line Service.
Section 17 outlines the procedures for dealing with the income levy and the parking levy in urban areas.
3. Income tax calendar
The income tax year commences on 1 January and ends on the following 31 December. Thus, week 1 is the period from 1 to 7 January inclusive; week 2 is the period from 8 to 14 January inclusive, and so on. Similarly, month 1 is the period from 1 to 31 January inclusive; month 2 is the period from 1 to 28/29 February inclusive, and so on. Weekly and monthly income tax calendars can be found in Weekly and monthly income tax calendars.
4. PAYE forms
Instructions describing how to complete temporary/emergency tax deduction cards are given on the cards themselves. A list of the forms that are required by employers for operating PAYE/PRSI is given in List of PAYE forms used by employers.
5. Determining the employment status of an individual
The law makes a distinction between a contract of employment (sometimes referred to as a 'contract of service') and a contract for service. Basically, a contract of employment applies to an employee-employer relationship, while a contract for service applies in the case of an independent – i.e. self-employed - contractor.
A worker’s employment status, that is whether they are employed or self-employed, is not a matter of choice. Whether someone is employed or self-employed depends upon the terms and conditions of the relevant engagement. In most cases it will be clear whether an individual is employed or self-employed. However, it may not always be so obvious. The criteria below should help in reaching a conclusion.
It is important that the job as a whole is looked at including working conditions and the reality of the relationship, when considering the guidelines. The overriding consideration or test will always be whether the person performing the work does so "as a person in business on their own account". Is the person a free agent with an economic independence of the person engaging the service?
Criteria used to determine if an individual is an employee
While all of the following factors may not apply, an individual would normally be an employee if they:
- Are under the control of another person who directs as to how, when and where the work is to be carried out
- Supply labour only
- Receive a fixed hourly/weekly/monthly wage
- Cannot sub-contract the work. If the work can be subcontracted and the subcontractor subsequently makes payments to an individual to carry out the work, the employer/employee relationship may simply be transferred on to the subcontractor/individual.
- Do not supply materials for the job
- Do not provide equipment other than the small tools of the trade. The provision of tools or equipment might not have a significant bearing on coming to a conclusion that employment status may be appropriate having regard to all the circumstances of a particular case.
- Are not exposed to personal financial risk in carrying out the work
- Do not assume any responsibility for investment and management in the business
- Do not have the opportunity to profit from sound management in the scheduling of engagements or in the performance of tasks arising from the engagements
- Work set hours or a given number of hours per week or month
- Work for one person or for one business
- Receive expense payments to cover subsistence and/or travel expenses
- Are entitled to extra pay or time off for overtime.
Criteria used to determine if an individual is self-employed
While all of the following factors may not apply to the job, an individual would normally be self-employed if they:
- Own their own business
- Are exposed to financial risk, by having to bear the cost of making good faulty or substandard work carried out under the contract
- Assume responsibility for investment and management in the enterprise
- Have the opportunity to profit from sound management in the scheduling and performance of engagements and tasks
- Have control over what is done, how it is done, when and where it is done and whether they do it personally
- Are free to hire other people, on their terms, to do the work which has been agreed to be undertaken
- Can provide the same services to more than one person or business at the same time
- Provide the materials for the job
- Provide equipment and machinery necessary for the job, other than the small tools of the trade or equipment which in an overall context would not be an indicator of a person in business on their own account
- Have a fixed place of business where materials equipment etc. can be stored
- Cost and agree a price for the job
- Provide their own insurance cover e.g. public liability cover,etc
- Control the hours of work in fulfilling the job obligations
If there is any doubt as to whether a person is employed or self-employed, the employer should contact Revenue.
The 
Code of Practice for determining the employment or self-employment status of individuals (PDF, 229KB) is available.
6. Assistance to employers
6.1 Revenue website
A comprehensive range of tax information, services and forms/leaflets is available on our site.
6.2 Employer helpline
An employer who does not find an answer to a query in relation to the operation of PAYE in this guide can get further assistance by calling the Employer Information and Customer Service Unit.
Telephone: 1890 25 45 65.
If calling from outside the Republic of Ireland please phone + 353 67 63400
E-mail: employerhelp@revenue.ie
Note: Paper forms P45 and P45 Supplement can be obtained from:
Revenue's Forms & Leaflets Service
Telephone (24-hour service)1890 30 67 06
If calling from outside the Republic of Ireland please phone + 353 1 70 23 050
e-mail: custform@revenue.ie
6.3 Collector General
Queries relating to the payment of tax or pay-related social insurance contributions should be directed to:
The Collector General,
Sarsfield House, Francis Street, Limerick.
Telephone: 1890 20 30 70
If calling from outside the Republic of Ireland please phone + 353 61 488000
Queries relating to the lodgement of end-of-year returns should be directed to:
The Collector General,
Sarsfield House, Francis St, Limerick.
Telephone: 1890 25 45 65
If calling from outside the Republic of Ireland please phone + 353 67 63400
6.4 PRSI queries
Queries relating to social insurance aspects of the system should be directed to:
Department of Social Protection,
Information Services,
Oisín House, 212 – 213 Amiens Street,
Dublin 2.
Telephone: + 353 1 7043000
6.5 Health levy queries
Queries relating to the payment of the Health Levy should be directed to:
Finance Unit,
Department of Health and Children
Telephone: + 353 1 6354000
6.6 Revenue On-Line service
Technical queries concerning the operation of the Revenue On-Line Service should be directed to:
Telephone: 1890 20 11 06
If calling from outside the Republic of Ireland please phone + 353 1 70 23021
You can also e-mail the Revenue On-Line Service at roshelp@revenue.ie
Tax queries on the operation of PAYE should be addressed to the Employer Information and Customer Service Unit:
Telephone: 1890 25 45 65
If calling from outside the Republic of Ireland please phone + 353 1 70 23021
E-mail: employerhelp@revenue.ie
6.7 LoCall phone number for PAYE employees
Employees' PAYE affairs are dealt with in the region in which they live:
| Region | Area Covered | Telephone No. |
|---|---|---|
| Border Midlands West Region | Cavan, Monaghan, Donegal, Mayo, Galway, Leitrim, Longford, Louth, Offaly, Roscommon, Sligo, Westmeath | 1890 777 425 |
| Dublin Region | Dublin (City and County) | 1890 333 425 |
| East & South East Region | Carlow, Kildare, Kilkenny, Laois, Meath, Tipperary, Waterford, Wexford, Wicklow | 1890 444 425 |
| South West Region | Clare, Cork, Kerry, Limerick | 1890 222 425 |
If calling from outside the Republic of Ireland PAYE employees can phone: + 353 1 70 23 021.
See the Contact Details page for a full list of Contact Details.
6.8 Self-service for PAYE employees
The quickest and easiest way for an employee to claim all their tax credits is to use one of the PAYE anytime options outlined below.
- Internet: Select a PAYE anytime option.
- Texting: Text info credit to 51829 to claim a selection of tax credits.
- Telephone: Use the LoCall 1890 number listed above to access a range of services.