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

Employment Wage Subsidy Scheme (EWSS)

The Temporary Wage Subsidy Scheme (TWSS) ends on 31st August 2020. EWSS will begin in full from 1st September 2020 and run until 31st March 2021.

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)


EWSS – Overview

Big Red Book Payroll 2020 EWSS Setup Guide

Employment Wage Subsidy Scheme (EWSS)

TWSS ends on 31st August 2020. EWSS can only be claimed for payrun dates from 1st September 2020 and run until 31st March 2021. Both schemes will run in parallel from 1st July 2020 until the TWSS ceases on 31st August 2020 with EWSS available via sweepback. It 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
  • Due to COVID-19, the business will experience at least a 30% reduction in turnover or orders in 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.
    • 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.

  • 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 Payroll 2020.
      • 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.

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.

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.

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

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 Payroll 2020 for EWSS or view the Helpfile in Payroll 2020.

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. 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 a statement into the ROS inbox of employers setting out the monthly subsidy total for all eligible EWSS payslips.

  • This allows a window for employers to make any corrections before the return due date (14th of the Month)
  • On the return due date, Revenue will post the Employer PRSI credit total due which will reduce the balance of the employer’s payroll taxes balance due.
  • After the return due date, the system will process the claim and make the payment into the designated bank account as soon as practicable thereafter.

Any amendments to submissions or new submissions adding a claim for EWSS after the return due date (the 14th of the following month) will not be processed for EWSS or the PRSI credit. This is in line with standard PMOD rules requiring

  1. payments to be submitted to Revenue on or before the date the employee is paid, and
  2. any adjustments to the monthly return are to be done by the return due date.

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.

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

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.

 


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 will end on 31st August 2020.

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.