As an employee you should always check your Payslips on a regular basis. Remember that your Employer is obliged by law to provide you a Payslip.
In Ireland, the frequency you get paid by is either on a weekly, bi-weekly (every fortnight) or on a monthly basis.
So what does Month 1/Week 1 (could be Month One or Week One also) basis mean stated at the top of your Payslip?
This means that your pay is not on Cumulative basis whatever that means (!)
To put it simply; for every pay period, you are taxed in isolation and no gross pay or deductions for the previous periods are taken into account. Your tax credits and your Cut off Points (COP) are not accumulated but proportioned as per pay period frequency.
The reason Revenue would put someone on Month 1/ Week 1 basis is if an individual had started back working as an employee after being self-employed for the current tax year or if Revenue is unclear about the previous earnings of an individual or no finish date of the previous employment had been provided. Other reasons would include an employee being in receipt of a social welfare payment such as Maternity Benefit or Illness Benefit.
In many circumstances however it is beneficial to be taxed on a Cumulative basis. Therefore, you should contact Revenue to see why you are on Month 1/Week 1 basis and if possible to put you on a Cumulative basis. This means that if you are due back any tax, you could receive it. You would not be able to get any tax back while on Month 1/Week 1 basis.
Revenue will inform you if it is not beneficial for you to be put on Cumulative basis. This can be when you tax credits have been reduced which would result in large underpayment being collected in one pay period, so you don't need to worry.
Revenue provides great examples of this:
To register or contact Revenue please go to:
or phone 01-7383636 before 1pm.
If you are unclear how to read your payslip, how to change the tax basis, please feel free to contact us.
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