P60 and Income Levy Certificates

When an Employer finalises their 2010 P35 for submission to the Revenue Commissioners, they should also issue the 2010 P60 and Income Levy Cert to each employee who was on the payroll at year end. There is a legal obligation to issue both a P60 and an Income levy Cert to every Employee and these documents should be issued as soon as the P35 is completed. If you are using Payroll Software, a P60 and Income Levy Cert should automatically be generated as part of the Year End process.

A P60 shows the Gross Salary earned by each employee during 2010 and the amount of PAYE & Employees PRSI deducted, together with the class/ classes of PRSI paid by the Employee during the year. Total PRSI paid during the year is also shown and by deducting the Employees PRSI from this we get the amount of Employers PRSI paid during the year.

Any employees who were on the payroll at the start of 2010 but have left during the year will have received a P45 on leaving and will not receive a P60. For Employees who joined the payroll during 2010, their P60 should contain the total Gross Salary and Deductions for all employments during 2010, provided that the details of their previous employment were properly entered on the payroll system when they were added to your payroll. If you are unsure about this, you should check with your accountant.

Employers P35 Return

If you’re an accountant, February 14th isn’t all about flowers and chocolates. It’s an important day for Employers because it’s the last day before the deadline (15th February) for the submission and payment of the 2010 P35 Returns to the Revenue Commissioners.

What is a P35?

A P35 Return is the annual summary of all amounts (Income Tax, Employers and Employees PRSI together with the Income Levy) payable by an Employer to the Revenue Commissioners for the 2010 tax year. These are listed by Employee and the total amount on the P35 Return should equal the sum of the P30 Returns submitted during 2010. Any shortfall in the amount paid during the year is to be paid with the P35 Return. The P35 return also gives the Revenue the required information about each individual employee and will correspond with the P60 form, together with the Income Levy Cert that is issued to each employee at this time.

The P35 Return can be submitted in paper format or electronically via ROS. In order to avail of the electronic submission facility, you must be registered with your accountant as a ROS client. Registration is straightforward and can be done very quickly. We recommend electronic submission of the P35 return, and all other Revenue tax forms, as it ensures you beat the deadline and there are no issues with delays in the post etc. A late submission of a P35 Return will automatically result in a fine.

The most common mistake relating to the failure to submit a correct P35 Return is the use of incorrect PPS numbers for Employees. If a PPS number is invalid, the P35 Return will be rejected by ROS so it’s a good idea to check all employees PPS numbers well in advance of the submission date.

As always, if you have any other queries re the submission of your p35 Return, please don’t hesitate to contact the office.