A pair of glasses on a one hundred euro note on a table

2025 tax reporting obligations for employers

16/01/2025
A pair of glasses on a one hundred euro note on a table

As we begin a new tax year, we would like to highlight the following important tax reporting obligations for employers.

Enhanced Reporting Requirements (ERR)

As previously reported and advised, ERR involves the mandatory reporting to Revenue by employers in respect of reportable benefits. Reportable benefits are those paid to employees without the deduction of tax and include the following three specific benefits:

  • Remote working daily allowance of €3.20
  • Payment of travel & subsistence expenses
  • The small benefit exemption

If you, as an employer, pay any of the above to your employees, you have an obligation to report this information directly to Revenue on or before the date of payment to the employee.

For 2024, Revenue operated a “service for compliance” whereby Revenue would not seek to apply penalties for non-compliance in the reporting of these benefits up to 31 December 2024.

From 1 January 2025, the “service for compliance” ends and there is an expectation that all employers providing benefits as outlined submit details of same on or before the provision of the benefit. Failing to do so could result in penalties arising.

Please see our previous article in relation to ERR and your ongoing requirements as an employer.

Special Assignee Relief Programme (SARP) return – due no later than 23 February 2025

A reminder for employers with employees availing of SARP relief in 2024 – the annual SARP employer return must be completed on or before 23 February 2025.

This return must be completed online via the dedicated SARP portal on ROS. Alternatively, the tax team here at Crowe can complete the return on your behalf. Please do not hesitate to get in touch should you need any assistance.

Share reporting obligations

If you are an employer operating share schemes or a trustee of certain approved share schemes, you have an obligation to file an annual return.

The standard filing deadline is 31 March following the year in which the activity arose. For example, returns in respect of 2024 activity are due by 31 March 2025. It should be noted that penalties may apply for failure to make returns.

Below is a sample of returns that may be applicable depending on the type of scheme an employer is operating.

  • Form ESA – for RSUs, discounted or free shares, ESPP, convertible securities, restricted shares, forfeitable shares, growth shares, other shares.
  • Form RSS1 – for any share options and any other rights to acquire shares or assets awarded to employees or directors.
  • Form KEEP1 – if KEEP options were granted, exercised, transferred or released.
  • Form ESS1 – for details of all Approved Profit-Sharing Schemes (APSS).

Auto-enrolment pension – due to commence 30 September 2025

From 30 September 2025, it is planned that Ireland will roll out the long-awaited pension auto-enrolment scheme. Under the scheme, the employee, employer and Government all pay a certain amount into the employee’s pension fund.

A new public body called the National Automatic Enrolment Retirement Savings Authority (NAERSA) will be set up to administer the scheme, and will be supervised by the Pensions Authority.

The aim of the scheme is to help employees to build up savings that they can access on their retirement, in addition to the state pension, by removing as much of the administrative burden as possible from the individual.

All companies with employees in Ireland, regardless of size or structure, will have to facilitate the auto-enrolment scheme for employees who meet the eligibility criteria and for those who wish to opt in. The scheme is aimed at employees who are not paying into a pension or PRSA. Such individuals will be automatically included in the scheme but can opt out after six months if they wish.

An employee will be automatically enrolled in the new pension scheme if they are:

  • aged between 23 and 60,
  • not currently part of a pension plan, and
  • earn €20,000 or more per year.

We are currently monitoring the rollout of the auto-enrolment scheme and we aim to communicate any relevant information as it becomes available. Please continue to keep an eye on our website for further updates.

Taxation of staff entertainment

Over the past 12 months, there has been significant media coverage around the taxation of staff entertainment and benefits. Revenue appear to be taking a more stringent approach to how such expenses are treated for tax purposes. There has been a noticeable shift in Revenue's stance, especially regarding whether certain types of employee entertainment are subject to Benefit-in-Kind (BIK) tax.

Christmas/seasonal parties

Revenue’s concession on staff entertainment provides that where an employer provides social events, such as Christmas parties, sports days or other inclusive events, no taxable BIK should arise where expenses are seen to be reasonable and the event is open to all employees.

Client entertainment expenses

If an employee pays for business entertainment expenses on behalf of their employer to perform the duties of their employment, they can be repaid without being taxed under the BIK rules. The expenses must be vouched – i.e., a receipt must be presented and retained.

Other types of staff entertainment

Employers often cover the costs of team nights out, including dinners, drinks or other entertainment activities, where not all company employees are in attendance. Such expenses are considered by many employers to be part of general company culture and may have been viewed as being non-taxable. However, Revenue now appear to be taking a more restrictive view of the types of staff entertainment that can be provided without imposing a BIK charge on employees.

Changes to the Small Benefit Exemption

Starting from 1 January 2025, employers are allowed to provide employees with up to five small benefits tax-free each year. These benefits cannot be in cash, and the total combined value of the five benefits must not exceed €1,500.

If more than five benefits are provided, only the first five are eligible for the exemption. Unused allowances cannot be carried over from one year to the next.

This increase in the small benefit exemption limit from €1,000 to €1,500 offers an opportunity for employers to consider using this benefit to mitigate any potential tax liabilities associated with staff entertainment that Revenue may view as taxable.

Employers should carefully evaluate whether the small benefit exemption can be used to avoid potential BIK charges on staff entertainment.

Changes to gender pay gap reporting

Starting in June 2025, the gender pay gap reporting obligation will be extended to employers with just 50 employees. It applies to the public as well as the private sector.

Currently, employers must include their gender pay gap data and statement of information on their website – or have it available for public inspection.

Employers must choose a ‘snapshot’ date in June and report on employees’ remuneration for the 12-month period that precedes the chosen snapshot date. Employers have six months from the chosen snapshot date to prepare calculations and publish their reports to their website.

We understand that the Government is currently developing an online gender pay gap portal.

This new system of reporting is also expected to result in the reporting deadline being brought forward to the end of November 2025.

Employers – both those already reporting and new to the regime – will therefore have a five-month window in which to report, slightly shorter than the current six-month timeframe.

In summary

Our tax team are on hand to help you with any issues that may arise. Should you have any queries, please do not hesitate to get in touch with a member of our tax department.

Contact us:

Grayson Buckley, Partner, Tax - Crowe Ireland
Grayson Buckley
Partner, Tax
John Byrne, Partner, Tax - Crowe Ireland
John Byrne
Partner, Tax
Lisa Kinsella, Partner, Tax - Crowe Ireland
Lisa Kinsella
Partner, Tax