Week 1 basis

santino

Hey All,

can anyone explain to me in simple terms what exactly 'week 1' is in payroll and when it is applied?

I've been doing payroll for a few clients for a couple of weeks and most of their employees are on cumulative basis.

I know that if a person is on 'week 1' basis you dont get to carry over tax credits etc. I'm lost after that though!!

Thanks

Dixie Chick

Week one is used in cases where an employee has commenced employment and you are unaware of their tax credits because they havent given you any documents to show them to you, like a P45.

Week one should be operated for the first 5 weeks of emplyment. if you still do not have the tax credits details by then, then the person needs to be put on an emergency tax basis.

Week one means just the standard cut off point and tax credit is used in the month/ week, nothing carries over to the next month /week , they are all stand alone.

magic roundabou

my understanding of week one is that only the revenue can put you on week one - it normally means that the person has either problems with previous employment or the tax office are not sure when they have worked.
if someone starts your employment and is not able to provide you with a p45 or even if they do - you have to put them on emergency tax until the revenue issue you tax credits for them which is normally in week or so -
with emergency tax for the first 4 weeks you are on nearly the stardard tax its only after 5 weeks that you are taxed on 100%, this is to make sure you get your taxes in order

santino

very helpful so far guys.

one more thing:
say a person is on a cumulative basis and they miss some weeks due to illness, lack of work for the employer etc.

As it it cumulative,they can take their tax credits forward but when they are back working again the tax credits will be higher than the actual tax that they SHOULD be paying and therefore no tax will be paid. Is this correct? And if so, will the tax (PAYE) eventually catch up with the credits so the employee will start paying tax again, say a month down the line.

Thanks again

Baby4

This post has been deleted.

Mr Clonfadda

week 1 or month 1 Basis is just treating a persons wages as if it was the first week in the tax year so you do not look at previous pay for the year previous tax paid.

An new employee should never be on a cumulative basis until revenue has confirmed their tax credits and cut off and also the previous pay & Tax

If a person is on a cumulative basis and has been out for a while they may have built up a certain level of tax credits but as to wether they pay tax again depend on a huge number of factors

If you are badly stuck please feel free to PM me

Mynners

Sorry to re-open a thread, but I've been looking for this information all morning. I'm on week 1 tax at the moment, after being on emergency for a couple of weeks. I'm getting about 200 euro taken from me every week, can I claim this back?
Thanks

dbran

Hi

You need to get onto the tax office to find out why you are on week one. If they decide to put you on cumulative after that telephone conversation then they will issue a new certificate of tax credits which your employer is obliged to apply when calculaing the amount they must deduct in PAYE and PRSI every period.

If the revenue do not put you in a cumulative bassis then you need to wait until the end of the year and apply for a p21 statement and get the excess tax deducted (or pay over any shortfall).

Usually the reason someone is on week one is the revenue believe that to put them on cumulative basis may result in them getting a refund that they are not entitled to or they are unsure of the total pay and tax gross to date figures you have earned in the year. So basically the revenue kick for touch and calculate the tax on a weekly basis, thus no tax refunds for previous periods unused credits and srco are possible.

This usually happens if you have a second job running at the same time or the previous employer has not yet submitted his copy of the P45. It just forces you to apply for a p21 at the end of the year and to sort it all out.

Also the earlier post by Dixie Chick on in this thread (in my humble opinion) is wrong as pointed out subsequently by others.

Kind Regards


dbran

otterj

Hi I am currently on a week 1 basis but it doesnt seem to affect my pay in that I would be paying the same amount of tax as if I was on the standard basis.... Just wondering if I stay on the week 1 basis will it effect my tax? Thanks in advance