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. Additionally, the operation of the scheme will reduce the burden on the Department of Employment Affairs and Social Protection (DEASP) which is dealing with the other COVID-19 related payments.
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.
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 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 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.
Who the scheme applies 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 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
Operating the scheme from Thursday 26 March 2020
The employer runs the payroll as normal, entering the following details for each relevant employee under the Scheme:
PRSI Class set to J9
a non-taxable amount equal to the employee’s net take home pay or €410 whichever is the lesser
if an employer is not making any payment to the employee, they should include a pay amount of €0.01 in Gross Pay
if an employer is making additional wage payments to affected employees, they should include this amount in the Gross Pay
it is important that employers do not include the Temporary Wage Subsidy payment in Gross Pay
the payroll submission must include pay frequency and period number
Income tax, USC, LPT, if applicable, and PRSI are not deducted from the Temporary Wage Subsidy.
In many cases the payment of the Temporary Wage Subsidy and any additional income paid by the employer will result in the refund of Income Tax or USC already paid by the employee. Any Income Tax and USC refunds that arise as a result of the application of tax credits and rate bands can be repaid by the employer and Revenue will also refund this amount to the employer.
Based on the information provided in payroll submissions and adherence to the maximum limits, described above, Revenue will credit employers with the temporary wage subsidy paid to each employee.
Penalties will apply to any abuse of the Subsidy Scheme by self-declaring incorrectly, not providing funds to employees or non-adherence to Revenue, and any other relevant, guidelines.
For general issues relating to the scheme, employers should contact Revenue's National Employer Helpline
via the myEnquiries system, providing details of the query and a direct dial contact number.
Employers should make sure to select ‘Employer’s PAYE’ and then ‘Employer’s PAYE General Enquiry’ when submitting the query through myEnquiries.
Revenue urges employers registered for Temporary Wage Subsidy Scheme to update bank details
Revenue have outlined that Revenue is unable to make some payments under the Temporary Wage Subsidy Scheme because a small number of employers have not set up a nominated Refund Bank Account on the Revenue On-Line System (ROS).
Revenue has confirmed that it is unable to pay more than €1.3 million to over 600 employers for payments made by them under the scheme.
Many employers will have an existing Payment Bank Account set up in ROS, however, to receive payments from Revenue, including under the Temporary Wage Subsidy Scheme, employers also need to set up a nominated Refund Bank Account.’
Revenue is asking any employer who is currently awaiting payment from Revenue to check that they have set up a nominated Refund Bank Account in ROS.
A Refund Bank Account, which must be SEPA (Single EURO Payments Area) reachable, can be set up as follows:
Log on to ROS
Select ‘Manage Bank Accounts’ option
Select the ‘Manage EFT’ option
Select ‘PAYE-EMP’ option
Enter ‘IBAN number’ (Can be found on bank statement)
Enter ‘BIC number’ (Can be found on bank statement)
Enter ‘Account Name’ (minimum requirement is first 18 characters)
Complete ‘Confirmation Screen’
Complete the ‘Sign and Submit’ requirement (ROS login password required).
Further information regarding Refund Bank Account requirements is available in the Frequently Asked Questions (FAQ) section of the Revenue website here