10 Payroll Mistakes to Avoid in 2025

Managing payroll effectively is essential for every business. A small mistake can lead to fines, compliance issues, or even unhappy employees. With the start of a new year, now is the time to review your payroll processes and avoid common errors that could cost your business.

Here are 10 common payroll mistakes to avoid in 2025:

1. Non-Compliance with Revenue Requirements

Under the PAYE Modernisation system, employers must submit payroll information to Revenue in real time. Failure to do so can result in penalties and compliance issues.

2. Ignoring Updates in Budget 2025

The national minimum wage will increase to €13.50 per hour from 1 January 2025. Ensure your payroll system is updated to reflect this change.

3. Overlooking GDPR Compliance

Employee data must be stored and processed securely. Ensure your payroll system complies with GDPR to avoid legal issues.

4. Failing to Back Up Payroll Data

Data loss can lead to significant disruptions. Regularly back up payroll records to secure vital information.

5. Untrained Payroll Staff

Payroll management requires a thorough understanding of compliance and processes. Invest in training or consider outsourcing to experts.

6. Manual Processing Errors

Human error is a leading cause of payroll issues. Switch to automated payroll systems to streamline operations and minimise mistakes.

7. Neglecting Auto-Enrolment Pension Preparation

With the introduction of auto-enrolment pensions on 30 September 2025, ensure your systems are ready to onboard eligible employees.

8. Ignoring Statutory Sick Pay Updates

The number of paid sick leave days has increased. Ensure compliance by updating your payroll processes.

9. Mismanagement of Small Benefit Exemptions

From 2025, you can provide up to five non-cash benefits worth €1,500 annually, tax-free. Use this to reward employees effectively.

10. Failure to Address Enhanced Reporting Requirements

Budget 2025 introduced stricter reporting rules for allowances and benefits. Stay on top of these changes to avoid penalties.

How We Can Help

At ITAS Accounting, we specialise in payroll management tailored to Irish businesses. Our team ensures compliance, accuracy, and peace of mind for you and your employees.

Ready to streamline your payroll processes? Get in touch today: 📧 info@itasaccounting.ie | 📞 01 539 7999

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Avoiding these payroll pitfalls will help you stay compliant, retain employee trust, and focus on achieving your business goals in 2025.