Payments to employees

  1. Overview
  2. Directors
  3. Holiday pay and advance payments
  4. Benefit in kind
  5. Shadow payroll

Holiday pay and advance payments

You may pay your employee ‘holiday pay’ in advance of their usual pay day.

Advance holiday pay may result in the employee receiving two or three weeks' pay in one week. The employee then receives no pay in the following two or three weeks. You may apply those weeks' tax credits, rate bands and Universal Social Charge (USC) cut-off points to the holiday pay. This cannot be done if your employee is leaving employment immediately after receiving holiday pay.

This procedure can also be applied to payments made to employees where there is a seasonal shutdown of the business. 

You must include the date the payment was made to the employee on the payroll submission. 

You must ensure you use the most up to date Revenue Payroll Notification (RPN) when the next payment is made to employees. This will ensure that any changes made to an employee’s tax credits during this period are taken into account in their next pay. 

Running your payroll in advance 

You must report employees pay to Revenue on or before the pay date. You may need to run your payroll in advance where your regular payroll operator is on leave. 

You must make provisions to ensure that you can pay your employees and report the pay and deductions to Revenue on or before the pay date.

Next: Benefit in kind