Press release
Minister Donohoe encourages companies in need to apply for the Employment Wage Subsidy Scheme
Published on
Last updated on
Published on
Last updated on
Decision in respect of treatment of tax liabilities by Revenue for recipients of the Temporary Wage Subsidy Scheme and the Pandemic Unemployment Payment welcome
The Minister for Finance, Paschal Donohoe, TD, has today (Friday) announced that 36,746 employers have now registered for the Employment Wage Subsidy Scheme (EWSS). He issued a reminder to all employers that the scheme remains open to them for applications for support in the future, should the time come when it is required.
The Minister also welcomed confirmation by the Revenue Commissioners that any outstanding USC and income tax liabilities that may arise for previous recipients of the Temporary Wage Subsidy Scheme and the Pandemic Unemployment Payment is to be collected over an extended period of four years, beginning in 2022. The Minister described this as a welcome development, which, he said, will significantly ease any potential burden on those with a tax liability as a result of availing of these schemes.
With regard to the EWSS, a number of flexible elements have been built into the design of the EWSS that reflect the changing environment around the COVID-19 pandemic and the approach of Government, which has shifted from emergency/crisis mode to one of living alongside the virus, in line with the recently announced Resilience and Recovery 2020-2021: Plan for Living with COVID-19 .
As many of the strictest public health measures that were put in place in March 2020 have been eased, the State subsidy has been designed to ensure that it is sustainable into a more medium term.
The EWSS has replaced the TWSS from 1 September as the Government’s focus has shifted from an employee income support paid via the employer that maintained the existing employee/employer relationship insofar as was possible, to a direct employer subsidy to help support viable firms and encourage employment. This includes prospective employment of new hires and seasonal workers.
The EWSS delivers a flat-rate subsidy based on the number of qualifying employees in a company. In addition, employers benefit from a significantly reduced rate of Employers’ PRSI at a rate of 0.5%.
The primary employer qualification is based on turnover in Q3 and Q4 2020 being less than 70% when compared with the same pre-pandemic period in 2019. This “turnover test” requires a comparison of the firm’s pre-pandemic operations with their current operations and has been specifically designed so as to target the subsidy at otherwise viable employers whose businesses continue to be adversely impacted by COVID-19.
Speaking today, the Minister said:
’I have been advised that over 82% of employers who were availing of the TWSS when it finished at the end of August have now applied for the EWSS which represents considerable take-up and continued support for hundreds of thousands of workers from August into September 2020’.
“I will continue to monitor closely the administration of the EWSS as well as the uptake and utilisation of this important economy-wide employment measure in the weeks and months ahead with a view to ensuring that it achieves its objective of supporting viable enterprises and employers”.
Responding to the statement by Revenue confirming their approach to the collection of tax that may be due on payments made under the Temporary Wage Subsidy Scheme and the Pandemic Unemployment Payment, Minister Donohoe said:
‘I acknowledge Revenue’s responsiveness throughout this year, having already implemented measures to warehouse tax liabilities and reduced interest rates on outstanding tax debt’.
“I also welcome Revenue’s latest announcement outlining the very flexible approach that they will take, including the collection of any outstanding USC and income tax liabilities that may arise over an extended period of four years, beginning in 2022. I am confident that Revenue will continue to work with their customers to minimise any financial hardship to the greatest extent possible, noting that because of our progressive tax system, in the vast majority of cases, the expected tax liability will be modest in scale.”
Further details on the arrangements for the collection of tax may be found at: