Did you know that Irish employers are now required to report details to Revenue when they reimburse employees and/or directors for travel and subsistence expenses?
The Enhanced Reporting Requirements (ERR) is a significant update introduced by the Finance Act of 2022 under Section 897C. ERR came into effect on 1st January, 2024 and details increased obligations for reporting expenses to Revenue using the Revenue Online Service (ROS).
These regulations are a continuation of Revenue's PAYE Modernisation initiative, which started in 2019, designed to enhance the transparency and compliance of the tax system and enable Revenue to effectively monitor and audit the provision of tax-free benefits and payments.
In this article, we look at these changes, the expenses it affects, and where you can eliminate these new reporting requirements by changing how you manage business expenses.
What Information do Businesses Need to Report to Revenue Under the Enhanced Reporting Requirements?
Under the new Enhanced Reporting Requirements, employers must submit details to Revenue when they reimburse employees or directors for the following travel and subsistence items, including the date paid and amount of each payment for:
- Travel vouched and unvouched
- Subsistence vouched and unvouched
- Site-based employees (including 'Country money')
- Emergency travel
- Eating on site
This reporting is facilitated through the Revenue Online Service (ROS) and requires essential employee identifiers like PPS number, date of birth, and Work ID.
Employers Must Report Every Time They Reimburse Employees for Expenses
A critical aspect of ERR is the timing of reporting. Payments must be reported to Revenue each time a payment is made to the employee or director at the time the payment is made, regardless of the payment frequency. This could be daily, weekly, or ad-hoc, depending on company preferences.
The increased reporting frequency and details required under ERR will bring an increased administrative burden for companies who reimburse employees for travel and subsistence expenses.
However, companies can change the way they manage expenses and eliminate this reporting requirement entirely.
Using CleverCards Prepaid Cards for Business Expenses Eliminates Reporting Requirements
While travel and subsistence expenses incurred directly by employees or directors, which are reimbursed by employers, must be reported to Revenue under ERR, Revenue states that:
Where a prepaid card, such as CleverCards prepaid digital Mastercards, is used by an employee or director to pay for expenses, the employer is not required to report them.
Providing employees or directors with CleverCards for business expenses means they are not being reimbursed, and so the reporting requirement is eliminated!
Reimbursing employees for travel and subsistence expenses from January 1, 2024:
Mary regularly travels to other countries for business purposes and does not have a company credit card.
Mary books a flight for a business trip to London and uses her personal card to pay for the flight. She submits the expense to her finance department with receipts and details for reimbursement from her employer.
The employer must report to Revenue when they reimburse Mary. They must do so using the Revenue Online Service (ROS) and provide details of the reimbursement and Mary’s PPS number, date of birth, and work ID.
Using CleverCard prepaid digital Mastercards for travel and subsistence expenses from January 1, 2024:
Mary’s employer provides her with a CleverCards digital prepaid Mastercard for business use. Her finance manager configures her CleverCard for travel and tops up Mary’s balance using their CleverCards business account.
Mary then books her flight using her CleverCards Business Card and uploads her receipt using the CleverCards app.
In this case, Mary’s employer is not required to report any details of the transaction to Revenue under ERR. And, they benefit from instant visibility on the amount and details of Mary’s purchase through the dashboard in the CleverCards business account.
So, using CleverCards for business expenses not only eliminates the obligation to report more details to Revenue’s Enhanced Reporting requirements, it also provides finance teams and business leaders with greater visibility and control over spending.
How Can Irish Businesses Prepare for the Impact of Enhanced Reporting Requirements?
All employers in Ireland should review their systems for recording and paying travel and subsistence expenses to ensure compliance with Revenue's new Enhanced Reporting Requirements.
Businesses who reimburse employees or directors for expenses and whose payroll process is managed by a third party, should ensure that the relevant data is collected and provided to the payroll service provider in a timely manner.
Alternatively, businesses can eliminate the obligation to report travel and subsistence expenses to Revenue under Enhanced Reporting Requirements by switching to CleverCards prepaid digital Mastercards.
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