On 24 March 2020, the Government announced measures to provide financial support to workers affected by the COVID-19 crisis. As part of these measures and building on the functionality developed through PAYE Modernisation, Revenue will operate the Wage Subsidy Scheme. This note sets out the Revenue approach to confirming employer eligibility and examination of supporting proofs. The scheme is a significant investment by Government in supporting both employers and employees through a subsidy that will be paid in real-time.
Revenue’s approach to businesses experiencing cashflow issues (and difficulties paying taxes) is to find a solution that will assist them until they can return to normality during this pandemic.
Revenue expects businesses to be able to produce relevant documentation to prove eligibility for the scheme on a basis of self-assessment and declaration by the employer concerned, combined with a risk focused follow up verification by Revenue involving an examination of relevant business records where that is considered necessary.
The COVID-19 Temporary Wage Subsidy Scheme is available to employers across all sectors excluding the Public Service and Non-Commercial Semi-State Sector. To qualify for the scheme a business must be experiencing a significant negative economic disruption due to the Covid-19 pandemic.
The purpose is to support businesses through the scheme, our approach will be based on a presumption of honesty.
Application for the scheme is based on self-assessment principles, a qualifying employer declares that it is significantly impacted by the crisis.
Key indicators are that the employer’s turnover is likely to decrease by 25% for quarter 2, 2020; that the business is unable to meet normal wages or normal outputs and any other indicators set out in our guidelines.
- Key Features of the scheme
- Replaces the previous COVID-19 Refund Scheme.
- Initially, and from 26 March 2020, the subsidy scheme will refund employers up to a maximum of €410 per each qualifying employee.
- However, employers should pay no more than the normal weekly net pay of the employee.
- The subsidy scheme applies both to employers who top up employees’ wages and those that aren’t in a position to do so.
- Employers make this special support payment to their employees through their normal payroll process.
- Employers will then be reimbursed for amounts paid to employees and notified to Revenue via the payroll process.
- The reimbursement will, in general, be made within two working days after receipt of the payroll submission.
- In April, the scheme will move to a subsidy payment based on up to 70% of the normal net weekly pay for each employee to a maximum of €410*.
- Income tax and USC will not be applied to the subsidy payment through the payroll.
- Employee PRSI will not apply to the subsidy or any top up payment by the employer.
- Employer’s PRSI will not apply to the subsidy and will be reduced from 11.05% to 0.5% on the top up payment.
How to Apply
If you need to register for the scheme, you can apply to Revenue by following these steps:
- Log on to ROS myEnquiries and select the category ‘Covid-19: Temporary Wage Subsidy’.
- Read the “Covid-19: Temporary Wage Subsidy Self-Declaration” and press the ‘Submit’ button.
- Ensure bank account details on Revenue record are correct. These can be checked in ROS and in ‘Manage bank accounts’, ‘Manage EFT’, enter the refund bank account that the refund is to be made to.