Revenue released new guidance on the Employment Wage Subsidy Scheme (EWSS). This new guidance includes information on the extension of the EWSS from 1 July 2021 until 31 December 2021. A number of updates were also included in the Main EWSS guidelines.
Section 28B of the Emergency Measures in the Public Interest (Covid-19) Act 2020, which provides for the operation of the EWSS, is to be amended by the Finance (Covid-19 and Miscellaneous Provisions) Bill 2021, and extends the EWSS until 31 December 2021. Revenue is currently operating the extension of the EWSS under care and management until such time as the legislation is enacted, so payment of the EWSS has not ceased.
The Guidelines on eligibility for the Employment Wage Subsidy Scheme from 1 July 2021 provide details on the employer eligibility criteria for the extended period.
An employer must be able to demonstrate that their business is expected to experience a 30 percent reduction in turnover or customer orders in the period 1 January to 31 December 2021 for pay dates from 1 July to 31 December, and this disruption is caused by COVID-19.
This reduction in turnover or customer orders is relative to:
- the period 1 January to 31 December 2019 where the business was in existence prior to 1 January 2019;
- where the business commenced trading between 1 January and 31 October 2019, from the date of commencement to 31 December 2019; or
- where a business commenced on or after 1 November 2019, the projected turnover or orders for 1 January 2021 (or date of commencement if later) to 31 December 2021 as if the pandemic had not occurred.
Employers are required to undertake a continued review of the eligibility on a rolling monthly basis comparing actual performance with projected performance over the period January to December 2021.
Employers must complete and submit a monthly EWSS Eligibility Review Form through ROS. Initial submissions should be made between 21 and 30 July 2021. On the 15th day of every subsequent month employers will need to provide the actual results for the previous month together with reviewing the original projections provided to ensure they remain valid. A summary table of the information and due dates is included on page 7 of the guidance.
Where an employer no longer satisfies the 30 percent test, they must deregister for the EWSS with effect from the first day of the month, or immediately where they become aware prior to the end of the month, and cease claiming the subsidy immediately. Employers can re-register where they become eligible again.
Significant updates included in the Main Guidelines on the operation of the Employment Wage Subsidy Scheme are as follows:
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Page
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Update |
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Rate of subsidy (page 18)
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The rate of weekly subsidy an employer has received per eligible employee since 20 October 2020 is unchanged until 30 September 2021.
Consideration is being given to an employer contribution to employee wages from October 2021. Further clarity on this, together with the subsidy paid rates to be paid from 1 October 2021, will be provided in September 2021.
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Operation of payroll and processing of subsidy claims (page 23)
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Certain employers will be able to warehouse overpayments of EWSS, where they are unable to repay due to COVID-19 restrictions.
- Period 1 runs until 31 December 2021 – 0% rate of interest
- Period 2 runs from 1 January 2022 to 31 December 2022 – 0% rate of interest
- Period 3 commences on 1 January 2023 until warehoused debts are discharged – 3% rate of interest applies
Other tax payments and filing obligations must be kept up to date for the duration of the debt warehouse period. Failure to meet such obligations will result in the withdrawal of the warehouse facility.
Employers in Revenue’s Personal Division or Business Division will generally have their EWSS overpayments warehoused automatically. LCD and MED cases must make an application.
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Reduced employer PRSI rate of 0.5% (page 24)
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Every time an EWSS subsidy claim is paid, the PRSI credit element will then be posted to the employer’s online Statement of Account. When the employer’s PAYE (Employer) balance is calculated at the start of the following month, this PRSI credit is deducted from the outstanding PRSI balance due. This reduced liability is what becomes due and payable for the relevant month.
An updated example has been provided.
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Publication (page 27)
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The names and addresses of employers who received the EWSS will be published in October 2021 and January 2022, in addition to the previous dates.
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Compliance checks (page 27)
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Revenue is undertaking real time checks of PAYE compliance of employers availing of the EWSS, and cross-referencing claim data against other Revenue data sources.
Revenue is also carrying out a follow-up programme with employers availing of the EWSS who display high risk indictors. Where agreement cannot be reached on issues identified, Revenue will raise an EWSS assessment which can be appealed to the Tax Appeals Commission within 30 days.
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“Other reasonable basis” (page 34)
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Employers will be required to submit supporting documentation to demonstrate a severe disruption to normal operations due to the pandemic resulting in a material adverse impact to the financial performance of the trade.
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