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Please see the below information in relation to the COVID-19 Wage Subsidy Scheme

Employment Wage Subsidy Scheme (EWSS)

EWSS runs in full from 1st September 2020 and is currently due to end on 31st December 2021.

On 1st June 2021 it was announced that the current enhanced payment rates and the reduced rate of Employers’ PRSI will be maintained for Quarter 3 pay dates (July, August, September). In order to benefit more firms, the time period for assessment will be broadened from the current 6 month period of assessment to a full 12 month period.

Revenue have provided an EWSS Eligibility Review Form which is available in ROS. Completing and submitting an EWSS Eligibility Review Form to Revenue is necessary to continue to avail of EWSS supports with details of an employer’s monthly eligibility review check to be submitted by 15th August in respect of details up to and including June 2021, and by the 15th of each of the following months in respect of July to November Reviews. See the chart below for more.

See here for more on the changes to Employer EWSS Eligibility.

For Quarter 4 pay dates (October, November, December), while the Government has approved the extension of the EWSS, it is considered too early yet to propose the precise operational parameters of the scheme that should apply for that quarter and decisions in that regard would be taken closer to the time around the end of August / early September. It should be noted that the question of an employer contribution to employee wages under the scheme will be considered.

TWSS Reconciliation

The TWSS Reconciliation process has now closed. Once any assessment has been issued in relation to TWSS Reconciliation it must be paid immediately, or debt warehousing/deferred payments must be arranged. See here for more information on TWSS Reconciliation or visit here for Revenue’s guidance document.

More EWSS Information from Big Red Book:

Big Red Book Guide to Employer EWSS Registration on ROS (Slides PDF)

Big Red Book Guide to EWSS (Slides PDF – Updated 19th July 2021)


EWSS – Overview

Big Red Book Payroll EWSS Setup Guide

Employment Wage Subsidy Scheme (EWSS)

EWSS makes provision for payment to qualifying employers of a flat rate subsidy for each eligible employee. Further details on EWSS can be found here.

Employer Eligibility:

To Qualify;

  • Employers must have a current tax clearance certificate in order to both register for EWSS and receive the monthly subsidy payments and PRSI credits.
    • A Tax Clearance Certificate is confirmation from Revenue that your tax affairs are in order as well as those of connected parties.
    • Information on Tax Clearance Certs can be found here.
    • Apply for or manage your Tax Clearance Cert by visiting ROS > My Services > Other Services > Manage Tax Clearance
  • The extension of the scheme provides for a significant change in the assessment period used to determine eligibility for pay dates between 1 July and 31 December 2021. For most businesses, eligibility will be determined by comparing the turnover or orders for the calendar year 2021 with the turnover or orders for the calendar year 2019. Many businesses were fully closed or severely limited in their capacity to trade due to the public health restrictions in place for the first seven months of 2021.
    • The change in the EWSS assessment period means that such businesses, taking account of the limited, if any, turnover in 2021 to date, can generate the equivalent of up to 70% of their calendar year 2019 turnover or customer orders for the remainder of 2021 and still remain eligible to claim support under the scheme.
Examples of how the change to the assessment period apply to certain sectors
  • A hairdresser that had turnover of €120,000* for the calendar year 2019, and was closed due to public health restrictions from 1 January 2021 to 10 May 2021, can generate turnover for the remaining ~7 ½ months of 2021 of up to €84,000, the equivalent of over 110% of the 2019 monthly turnover, and remain eligible for support under EWSS.**
  • A café or restaurant that had turnover of €580,000* for the full year 2019 and provided a restricted take-away service during the period of public health restrictions. The business operated at approximately 20% of 2019 turnover from 1 January 2021 until 7 June 2021, totaling €48,000. The business can generate turnover for the remaining ~7 months of 2021 of up to €358,000 (€406,000 – €48,000), the equivalent of 105% of the 2019 monthly turnover, and remain eligible for support under EWSS.**
  • A ‘wet’ pub that had turnover of €290,000* for the calendar year 2019, and was closed due to public health restrictions from 1 January 2021 until 26 July 2021*** can generate turnover for the remaining ~5 months of 2021 of up to €203,000, the equivalent of over 165% of the 2019 monthly turnover, and remain eligible for support under EWSS.**
Pre-June 2021 Eligibility Rules

For the period 1st January 2021 to 30th June 2021 this reduction in turnover or orders is relative to:

  • the same period in 2019 where the business was in existence prior to 1st January 2019, or
  • the period from the date the business commenced to 30th June 2019, or
  • where a business commenced after 1st May 2019, the projected turnover or orders.

For the period 1st July 2020 to 31st December 2020 this reduction in turnover or orders is relative to:

  • the same period in 2019 where the business was in existence prior to 1st July 2019, or
  • the period from the date the business commenced to 31st December 2019, or
  • where a business commenced after 1st November 2019, the projected turnover or orders, due to COVID-19, the business will experience at least a 30% reduction in turnover or orders.

 

    • EWSS payments are considered trading income but are to be ignored when calculating the 30% reduction in turnover.
    • Childcare businesses registered in accordance with Section 58C of the Child Care Act 1991 qualify without needing to show a reduction in turnover.
    • Employers should keep proof of your eligibility for the scheme (evidence of reduction in turnover and other evidence). You can read detailed information on the supporting proofs in Appendix I of Revenue’s EWSS Guidelines (pdf).
  • Employers must register on ROS for the scheme. Revenue made this available from Tuesday 18th August 2020.
    • Employers must register before beginning to submit payruns from 1st September onwards under EWSS
      • There will be no backdating for pay dates before being registered other than those to be claimed via July & August Sweepback
    • Register for EWSS by visiting ROS > My Services > Other Services > Manage Tax Registrations
      • Click here for a guide on registering for EWSS.

Continued Employer Eligibility Review:

Revenue require Employers to review their eligibility based on turnover or orders on the last day of each month.

Monthly review to check eligibility

A key requirement since the introduction of the EWSS in September 2020, is that employers undertake a review on the last day of every month to ensure they continue to meet the eligibility criteria.

To enable employers to meet this requirement, Revenue is providing an EWSS Eligibility Review Form in ROS. Completing and submitting an EWSS Eligibility Review Form to Revenue will be necessary to continue to avail of EWSS supports with details of an employer’s monthly eligibility review check to be submitted by 15th August in respect of details up to and including June 2021 and by the 15th of each of the following months in respect of July to November reviews.

Submission Due Date Actual monthly figures to be returned Projected monthly figures to be returned
15 August 2021 January to December 2019
January to June 2021
July to December 2021
15 August 2021 July 2021 August to December 2021
15 September 2021 August 2021 September to December 2021
15 October 2021 September 2021 October to December 2021
15 November 2021 October 2021 November and December 2021
15 December 2021 November 2021 December 2021

Timely submission of the form is required to ensure continued access to the scheme and will provide assurance to both employers and Revenue that subsequent EWSS claims are appropriate and in line with the terms of the scheme. This, in turn, will reduce the possibility of employers, inadvertently or incorrectly, claiming EWSS amounts to which they are not entitled and having to subsequently repay those amounts to Revenue.

  • Should the review find that eligibility is no longer met, then you should
    • De-register for EWSS immediately with effect from the following day.
      • This can be done by visiting ROS > My Services > Other Services > Manage Tax Registrations and choosing ‘Cease Registration’ for Employment Wage Subsidy Scheme.
    • Turn off Employer EWSS flag in Big Red Book Payroll.
      • This can be done in Settings > Wage Subsidy.

It is possible to re-register should circumstances change again.

Should you become aware that you will no longer be eligible at any stage in a month, gain a new large contract/order for example, you should immediately de-register for EWSS.

Employers with more than one business type

There are three categories of employers for selection at the initial stage of the ERF completion:

  • Registered childcare businesses
  • New Businesses (those who commenced after 1 November 2019)
  • All Others.

In instances where employers fit into ‘All Others’ as well as one of the other two, they should complete in respect of ‘All Others’ and ignore their registered childcare business, or new business (that which commenced after 1 November 2019).

Where employers have several eligible businesses, one ERF should be completed with details of all eligible businesses included.

‘New Business’

 There have been instances where employers who have activity prior to 1 November 2019 have selected ‘New Business’. Where employers have incorrectly selected this option, contact should be made through MyEnquiries setting out details of error made and seeking that same be amended.

Eligible Employees:

In general, all ordinary PAYE employees of a company will be eligible for EWSS.

On 31st August 2020 Revenue confirmed that the EWSS can be claimed in respect of proprietary directors, subject to the following conditions:

  • the employer meets the eligibility criteria for the EWSS,
  • the proprietary director is on the payroll of the eligible employer, and
  • the proprietary director has been paid wages which were reported to Revenue on the payroll of the eligible employer at any stage between 1st July 2019 and 30th June 2020.

Where a person is a proprietary director of two or more eligible companies, a claim for EWSS can only be submitted in respect of a single company. In this situation the following will apply:

  • the proprietary director will be required to elect one company for the purposes of making EWSS claims for the period of the scheme. The election will be deemed to be made on the first submission of an EWSS claim in respect of the proprietary director,
  • once an election is made it cannot be changed during the term of the scheme,
  • no claims for EWSS in respect of the same proprietary director should be submitted by the other companies.

Newly Hired Connected Parties who were not on the payroll and paid at any time between 1st July 2019 and 30th June 2020 are not eligible for EWSS. Connected parties include brothers, sisters, linear ancestors, linear descendants, aunts, uncles, nieces, nephews of an individual and their spouse.

Employees with multiple employments for different employers can be claimed for by each employer.

Revenue have stated that employees who earn under or over the limits allowed for a subsidy to be paid should not be marked to be included for EWSS.

Payroll Process:

The payment should be processed as normal, i.e. regular reporting of Income Tax, USC and PRSI. EWSS simply needs a payment submission to be flagged for EWSS. The rest will happen in the background. Big Red Book Payroll Version 20.10.00 added the functionality required to mark payments for EWSS.

See our video here on how to Setup Big Red Book Payroll for EWSS or view the Helpfile in Big Red Book Payroll.

On receipt of an eligible EWSS payslip from an eligible employer, Revenue will

  1. Calculate the subsidy payable by reference to the gross pay, pay frequency and insurable weeks reported on the payslip.
  2. From Early November, make a payment of the subsidy payable payment into the designated bank account within a couple of days of Revenue receiving an eligible EWSS payslip.
    • EWSS payments for October payslips will be made soon after November 5th.
  3. Calculate a PRSI credit due to the employer by recalculating employer PRSI using 0.5% and if greater than employer PRSI paid subtracting this from employer PRSI paid as reported on the payslip.

On the 5th of the following month Revenue will post the total Employer PRSI credit total due which will reduce the balance of the employer’s payroll taxes balance due.

Any changes to the EWSS payable amount made to a submission after an EWSS payment has already been received for that submission will result in an adjustment to the next EWSS payment from Revenue.

With this in mind it is really important that employers make timely and correct payroll submissions. Corrections or late Submissions for EWSS made after the 14th of the following month will require a review by Revenue before any adjustment/payment of EWSS or PRSI credit to an employer might be made.

This is in line with Revenue PAYE rules that state

  1. Submissions must be made to Revenue on or before the Payment date
  2. Corrections to the monthly return must be completed by the 14th of the following month

Calculating Weekly Gross Pay for Calculation of Subsidy Payable:

Weekly Pay Frequency

  • If insurable weeks is greater than 0 and less than or equal to 5
    • Divide gross pay by insurable weeks
  • If insurable weeks less than or equal to 0
    • Nil subsidy payable
  • If insurable weeks is greater than 5
    • Nil subsidy payable

Fortnightly

  • If insurable weeks is greater than 0 and less than or equal to 5
    • Divide gross pay by insurable weeks
  • If insurable weeks less than or equal to 0
    • Nil subsidy payable
  • If insurable weeks is greater than 5
    • Nil subsidy payable

Monthly

  • If insurable weeks is 4 or 5
    • (Gross pay *12) / 52
  • If insurable weeks equal 1, 2, 3, 6, 7, 8, 9
    • Divide gross pay by insurable weeks
  • If insurable weeks less than or equal to 0
    • Nil subsidy payable
  • If insurable weeks is greater than 9
    • Nil subsidy payable

PRSI Exempt Employees will be treated as if they have the standard PRSI weeks for the pay frequency,

  • 1 Insurable Week for Weekly,
  • 2 Insurable Weeks for Fortnightly or
  • 4 or 5 Insurable Weeks for Monthly.

Initial Subsidy Amount Payable:

Gross Weekly Wages Subsidy Payable
Less than € 151.50 Nil
From € 151.50 to € 202.99 € 151.50
From € 203 to € 1,462 € 203
More than € 1,462 Nil
Valid for Pay Run Dates upto October 19th 2020

Enhanced Subsidy Amount Payable:

Gross Weekly Pay Subsidy Payable
€0 – €151.49 Nil
€151.50 – €202.99 €203
€203 – €299.99 €250
€300 – €399.99 €300
€400 – €1462.00 €350
€1462.01 + Nil
Valid for Pay Run Dates from October 20th 2020 until 30th September 2021 at least

On 6 January 2021, the Minister for Finance announced the extension of these enhanced subsidy rates to apply to pay dates from 1st February 2021 until 31st March 2021. They were then extended again until 30th June 2021. On 1st June 2021 it was announced that the enhanced rates would remain in place until 30th September 2021 at least.

 

Total Subsidy Payable

For Pay Frequencies listed above other than Monthly Pay Frequency with 4 or 5 insurable weeks

  • Total Subsidy = Subsidy Payable * Insurable Weeks Reported

For Monthly Pay Frequency with 4 or 5 insurable weeks

  • Total Subsidy = (Subsidy Payable *52)/12

Payroll Submission Warnings and Rejections:

  • Revenue are putting in place Submission warnings and rejections in order to help with administration of EWSS.
  • Payroll submission rejection where a payslip is marked for EWSS but employer is not registered or re-registered for EWSS.
    • Messaging: “Employer is not EWSS registered.”
      • The Employer can Register via ROS and attempt to submit again or
      • The Employer should deactivate Employer EWSS in Payroll and submit without EWSS flags.
  • Payroll submission warning where a payslip is marked for EWSS but employer does not have an active tax clearance certificate.
    • Messaging: “EWSS employer does not currently have tax clearance”.
      • The Employer will have up to the Return due Date to get an active Tax Clearance Cert in place or else the Subsidy Payment and ER PRSI Credit will not be processed automatically for that month.
      • If Tax Clearance is regained after the return due date the employer should contact Revenue via MyEnquiries by selecting ‘Employer’s PAYE’ and then ‘Employer’s PAYE General Enquiry’ to request that the refund be issued.
  • Line item warning where a payslip is marked for EWSS but the calculated weekly gross pay is below €151.50 or above €1462.
    • Messaging:  “EWSS payslip weekly gross pay not in range”.
      • No Subsidy is Payable. The employer should consider removing the EWSS flag from the employee to avoid further warning messages if this will be the case for every payslip for the employee.
  • Line item warning where a payslip is marked for EWSS but does not have an eligible number of insurable weeks.
    • Messaging: “EWSS insurable weeks not within range for given pay frequency”.
      • No Subsidy is payable.

 


EWSS Sweepback for July & August:

Revenue have released a pdf guide with details of the EWSS July/August Sweepback.

Employers who are eligible for EWSS may claim EWSS in respect EWSS eligible employees for pay dates from 1st July via Sweepback provided

  • The Employer was not eligible for TWSS or
  • The Employee was not eligible for TWSS

A Sweepback CSV template has been made available by Revenue . Each employer will need to populate this template with the eligible employees they wish to claim EWSS for in the July/August period under the ‘sweepback’ process.

  • Payroll v20.10.07 onwards includes a utility that will create this CSV for employers.

From 15th September, Revenue will make a new link available in the ‘Employer Services’ Section on ROS, where employers can upload their completed CSV file.

  • A step by step guide to using this link to upload the CSV is included in the Revenue pdf guide.
  • The CSV must be uploaded to ROS before 14th October 2020.

Any subsidy due will be paid into the designated bank account as soon as practicable after 16th September.

Any Employer PRSI credit due will be applied to the relevant month, i.e. July or August, as soon as practicable after 16th Septemeber.

 


Temporary Wage Subsidy Scheme (TWSS)

The Temporary Wage Subsidy Scheme (TWSS) was introduced the Government to provide financial support to workers whose employers are affected by the COVID-19 pandemic and unable to pay the employee. The scheme ended on 31st August 2020.

The TWSS Reconciliation process is currently underway, and employers must ensure all ‘Subsidy Paid’ amounts are reported to ROS by the end of October 2020. See here for more information on TWSS Reconciliation.

See Temporary Wage Subsidy Scheme (TWSS) for further information on TWSS

 


Standard Rate of VAT

There will be a 6-month reduction in the standard rate of VAT from 23% to 21%, effective from 1st September 2020. The VAT rates in Big Red Book and Big Red Cloud should generally not be changed and therefore a new rate should be added for 21% if required.

Big Red Book Users: See Video at 2 minute 40 seconds or review ‘First 5 Steps to Set Up’ regarding Adding VAT Rates.

Big Red Cloud Users: See here for how to add a VAT rate.