The Incomes Register will change how earnings payment data is reported

Transcription

1 The Incomes Register will change how earnings payment data is reported

2 The Incomes Register is an electronic database for income, pension and benefit data One register one standardised way to act The Incomes Register collates the data and distributes it to the parties that need it. The Incomes Register does not modify or refine the data entered in it, but acts as a distributor of raw data. Two-phase implementation 1. As of 2019, earnings payment data will be reported to the Incomes Register. 2. As of, pension and benefit data will also be reported to the Incomes Register. The reporting of data to the Incomes Register will apply to all earned income payers as of 1 January 2019, without a transition period.

3 Incomes Register Wage earner or recipient of benefits income Payslip or benefit decision Benefit payer 1 Benefit payer n Bank account Employer 1 Employer n Incomes Register Data users Kela Earnings-related pension providers and the Finnish Centre for Pensions Unemployment Insurance Fund Finnish Tax Administration The Education Fund Labour protection authorities Administrative sector of the Ministry of Economic Affairs and Employment Statistics Finland Unemployment funds Non-life insurance providers Local authorities

4 Key principles of the Incomes Register

5 Key principles The annual information returns for earnings will be discontinued. As of 1 January 2019, all earnings payment data will be reported only once to the Incomes Register to serve the needs of all users of the Incomes Register data. Reporting of data becomes real-time. The last annual information returns for earnings will be filed for the year There will now be no need to report the same earnings payment data several times. The data is reported within 5 days of the payment date. The data is submitted payment-specifically. The data is submitted income earner specifically and separately for each payment transaction. Online transactions are a basic requirement. The data can be submitted on a paper form only in special circumstances. It is possible to reduce the manual steps involved in reporting with the help of the technical interface. The Incomes Register only applies to reporting. It will have no effect on payment cash flows or due dates. The data contents of the Incomes Register have been constructed in cooperation with data users and providers. Since every item of data is needed by a user, there is no unnecessary data. The terminology has been standardised with some new terms introduced, such as "income types" for "pay types" in the Incomes Register.

6 Key points of the procedure Reporting and using the data is free of charge Payments made on 1 January 2019 and later, and any corrections to be made to these incomes, are reported to the Incomes Register Data submitted to the Incomes Register is retained in the income information system for a period of ten years, which matches the time during which employers are obliged to retain their payroll and other bookkeeping information. The Incomes Register does not create new data access rights not all data in the Incomes Register is freely available to all the legislation specifies which data each user may view or use

7 Reporting data is effortless, with the help of the technical interface For several years now, the Incomes Register project has been working together with payroll administration software houses. The primary objective is to build a technical interface between the payroll administration software and the Incomes Register.

8 Benefits of the technical interface Electronic services guarantee the quality of the data. Manual work steps will be reduced and automation will be utilised. The user will have the feeling of using a single software application. Personal identification is not required every time you submit a report; identification is based on a certificate when the interface is opened. If a technical interface between a payroll administration system and the Incomes Register has been created, there will be no need to separately report the data through a separate service; the data is automatically inserted into the Incomes Register and is distributed to data users from there. Other channels for reporting data The Incomes Register's e-services, through which data can be reported through the upload/download service or on an online form. NB! Data cannot be uploaded to the Incomes Register from the Ilmoitin.fi service. In special circumstances, data can be submitted on a paper form.

9 What will change in the work of a payroll officer? The rhythm of reporting earnings payment data will change Reporting will take place in real time and payment-specifically. In practice, there will be a transition from annual reporting to payment-specific reporting The last annual information returns for earnings will be filed for the year The reporting-related work will be more evenly distributed over the entire year. The obligation to report the same earnings payment data multiple times will be eliminated. The number of retroactive investigations will be reduced if the data has been submitted once, it will not be requested again. All mandatory data must be reported In the Incomes Register, pay types equal income types

10 What will not change in the work of a payroll officer? The Incomes Register will not change payroll accounting The Incomes Register will not eliminate salary slips The Incomes Register will have no effect on payment obligations or cash flows the change only applies to reporting Certain statistics-related obligations remain The Incomes Register will not affect final taxation

11 Data contents of earnings payment data Earnings payment data contents have been constructed in cooperation with data users and providers. Because every piece of data in the Incomes Register is needed by a user, there is no unnecessary data. The data contents are divided into two reports: 1. Earnings payment report Mandatory data (M) Complementary data (V) Complementary income types Other complementary additional data 2. Employer's separate report Data not reported on an earnings payment report

12 Data contents: Mandatory and complementary data The recommendation is that data be submitted to the Incomes Register as comprehensively as possible. Data in an earnings payment report submitted to the Incomes Register can be divided into mandatory and complementary data Mandatory data Replaces the annual information returns to the Tax Administration, the earnings-related pension industry, TVR, and certain monthly reporting streams to the Tax Administration and the earnings-related pension field. The benefits will be minor, if only the mandatory data is submitted. Complementary data is data that currently needs to be delivered on request For example, complementary data comprises certain data on the employment relationship, absence data, or the earnings periods of the different income types.- The data is used for making benefit decisions, specifying customer fees, and claims handling. When an employer submits the complementary data directly in connection with the wage payment, there is a reduction in retroactive investigative work. Benefits applied for by the employer directly increase the employer's load. Benefits applied for internally by the employee, such as a pay slip or additional reports, indirectly increase the load of the employer

13 Contents of an earnings payment report Basic information/contact information Basic details of the payer and the income earner Wages/earned income in total (either as a total sum or itemised) Various types of pay (contract, performance-based and time-rate pay) Compensation and supplements for non-standard working hours and exceptional situations Compensation related to termination of employment and lay-offs Separately reported income types Fringe benefits as a rule, itemised in the same way as on the current annual information return of the Tax Administration Reimbursement of expenses as a rule, itemised in the same way as on the current annual information return of the Tax Administration Payments based on the profit sharing of the organisation Payments only subject to withholding, athlete's fees, compensation related to international situations, etc. Employment details Type, form, duration and unit price of the employment, weekly working hours, occupational class Insurance information Pension-insurance related and occupational accident insurer policy numbers, other insurance information Items deducted from the income All items and fees deducted from the pay; withholding, net wage, distraint Absence data Paid and unpaid absences and their reasons, pay for the period of paid absence, Unjust enrichment Amount and information on which pay period and income type it involves Recovery Amount and information on which pay period and income type it involves 13

14 Employer's separate report The following employer-specific data not reported on an income earner specific earnings payment report has been identified to date Data to be reported: 1. No wages payable data A regular employer must report monthly, if there are no wages payable 2. Employer's health insurance contribution (total) The payer reports the amount of employer's health insurance contribution calculated from the wages it has paid during the month in question 3. Deductions made from the employer's health insurance contribution, of which the employer pays the health insurance contribution Deductions made from the payer's voluntary health insurance contributions

15 Correction of data Replacement method The payer is responsible for the accuracy and correction of any data it has submitted to the Incomes Register Earnings payment data in the Incomes Register is corrected using the replacement method A report is corrected by resubmitting all data, including data that was correct in the original report. The replacement report is submitted in place of the payday report containing the error. An income earner may have several valid reports with the same pay period and payment date "New report" will not replace a previously submitted report When correcting data, it must be possible to allocate the correction to the correct report Incomes Register report reference used to allocate the corrections to the correct report, which is received by the payer when submitting a new report payer's own report reference, if the report reference generated by the Incomes Register cannot or will not be used for the correction 15

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