Current Information On Temporary COVID-19 Wage Subsidy Scheme
- Thu 26 March, 2020
There have been many questions regarding the Temporary COVID-19 Wage Subsidy Scheme.
We have collected below all information as known at this time.
If you have a question that is not covered in this information please email it to damon@dublintown.ie and we will include it in our regular mailings to the Government and its agencies and share with our mailing database when known.
However, if the information you are looking for is time or business critical, we would suggest contacting your professional advisors for clarity.
General Information
The Government announced new measures to provide financial support to Irish workers affected by the Covid-19 crisis. As part of these measures, Revenue will operate a Temporary Wage Subsidy Scheme. The scheme, enables employees, whose employers are affected by the pandemic, to receive significant supports directly from their employer. The scheme will run for 12 weeks from 26 March 2020. Draft legislation governing the scheme will be published shortly.
The operation of the Temporary Wage Subsidy Scheme will be available to employers who keep employees on the payroll throughout the COVID-19 pandemic, meaning employers can retain links with employees for when business picks up after the crisis. Employers are encouraged to facilitate employees by operating the scheme, by retaining employees on their books and by making best efforts to maintain a significant, or 100% income, for the period of the scheme.
What is the COVID-19 Wage Subsidy Scheme
The COVID-19 Wage Subsidy is a scheme which allow employers to pay their employees during the current pandemic. Employers will be refunded up to 70 percent of an employee’s wages – up to a level of €410.
The employer is expected to make their best efforts to maintain as close to 100% of normal income as possible for the subsidised period.
This payment replaces the Department of Employment Affairs and Social Protection’s Employer Refund Scheme announced on 15th March, and any business that received refunds under the current scheme do not need to reapply.
Revenue will contact them directly to confirm that they meet the conditions for this new scheme.
Key Features of the scheme
- Replaces the previous COVID-19 Refund Scheme.
- Initially, and from this Thursday (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 take home pay of the employee.
- The subsidy scheme applies to employers who top up employees’ wages and those that are not 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 70% of the weekly average take home pay for each employee up 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.
- Employers PRSI will not apply to the subsidy and will be reduced from 10.5% to 0.5% on the top-up payment.
- (details on this will be made available by Revenue in due course).
Who does the scheme apply to?
The Scheme is available to employers from all sectors (excluding the public service and non-commercial semi-state sector) whose business activities are being adversely impacted by the COVID-19 pandemic.
The scheme is available for employers who retain staff on payroll; some of the staff may be temporarily not working or some may be on reduced hours and/or reduced pay. Provided the employer meets the conditions set out below and subject to the levels of pay to the employees, the employer may be eligible for the scheme for some or all of the employees.
To qualify for the scheme, employers must
- be experiencing significant negative economic disruption due to Covid-19
- be able to demonstrate, to the satisfaction of Revenue, a minimum of a 25% decline in turnover
- be unable to pay normal wages and normal outgoings fully
- retain their employees on the payroll.
The Scheme is confined to employees who were on the employer’s payroll as at 29 February 2020, and for whom a payroll submission has already been made to Revenue in the period from 1 February 2020 to 15 March 2020.
The names of all employers operating this scheme will be published on Revenue’s website in due course, after the scheme has expired.
Registering for the Temporary Wage Subsidy Scheme
Any employer, already registered with Revenue for the purposes of the Employer COVID-19 Refund Scheme, is not required to take any further action. The employer may make payroll submissions from 26 March 2020 under the subsidy scheme arrangements on the same basis as they were doing for the Employer Refund Scheme, and €410 will be refunded in respect of each eligible employee per week.
Employers, or their agents, wishing to register for the scheme can apply to Revenue by carrying out the following 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.
Full Details are also available at:
https://revenue.ie/en/corporate/communications/covid19/index.aspx
https://www.gov.ie/en/service/578596-covid-19-wage-subsidy/
COVID-19 Pandemic Unemployment Payment
What is the COVID-19 Pandemic Unemployment Payment
The COVID-19 Pandemic Unemployment Payment is a payment of €350 per week. It is available to all employees and the self-employed who have lost their job due to the COVID-19 (Coronavirus) pandemic.
The COVID-19 Pandemic Unemployment Payment will be in place for the duration of the crisis.
How to qualify
You can apply for the new COVID-19 Pandemic Unemployment Payment if you:
- are an employee or self-employed
- are aged between 18 and 66 years old
- live in the Republic of Ireland
- have lost your job due to the COVID-19 (Coronavirus) pandemic
- have ceased trading due to the pandemic if you are self-employed
Rate of Payment
The COVID-19 Pandemic Unemployment Payment is paid at a flat rate of €350 per week for the duration of the pandemic emergency. It was originally set at a rate of €203 but it was increased by government on March 24.
If you have already applied before the 24th of March or are already in receipt of the Pandemic Unemployment Payment you do not need to do anything. Your next payment will be paid at the increased rate.
Payment is made by electronic transfer only (into your bank account) and only into accounts held in Irish financial institutions. It will be paid into your bank account every Tuesday once your application is processed.
If you were working and were also in receipt of any social welfare payment such as a Carers Payment, Working Family Payment (WFP) or One-Parent Family Payment, you can, provided you have lost your job due to COVID-19, also claim the COVID-19 emergency payment, in addition to retaining your existing welfare payment. The COVID-19 Payment Unemployment Payment will replace your employment income and will be regarded by the Department as equivalent to employment income.
If you have one adult and one or more dependant children you should claim a Jobseeker’s Payment instead of the COVID-19 Pandemic Payment.
This is because you can claim an additional allowance for your adult dependent and child dependents, which will bring your weekly payment to in excess of the €350 weekly payment due under the emergency COVID-19 Pandemic Unemployment Payment.
Full details are available at:
https://www.gov.ie/en/service/be74d3-covid-19-pandemic-unemployment-payment/
Short Time Work Support
If you have been temporarily placed on a shorter working week, you may qualify for Short Time Work Support.
Short-time Work Support is a form of Jobseeker’s Benefit and is an income support payment if you have been temporarily placed on a shorter working week.
The payment is made in respect of your regular salary for the days that you are no longer working. For example, if your working week has been reduced from a 5-day work pattern to a 3-day work pattern, you can receive support for the other 2 days.
Short-time Work Support is paid for a maximum of 234 days. Your entitlement will depend on the number of social insurance contributions you have.
To qualify for Short-time Work Support, you must satisfy the two main PRSI Conditions for Jobseeker’s Benefit
Employees must work 3 days per week or less to qualify, having previously been employed on a full-time basis.
Full details are available at:
https://www.gov.ie/en/service/c20e1b-short-time-work-support/
Income Supports
A number of income supports are available from the Department of Employment Affairs and Social Protection for your employees during a COVID-19 (Coronavirus) related absence or temporary lay-off from work:
- employees and the self-employed who have lost employment due to a downturn in economic activity caused by the COVID-19 pandemic
- workers who are not diagnosed with COVID-19 but who self-isolate
- workers whose employers do not supplement/top-up the State Illness Benefit payment (COVID-19)
- workers who are requested to stay at home by their employer (COVID-19)
- workers who are laid off temporarily or put on to short time working (COVID-19)]
- workers who need to take time off work to care for a person affected by COVID-19 (Coronavirus)
Full Details are available at:
https://www.gov.ie/en/publication/612b90-covid-19-information-for-employers/#short-time-work-support