Temporary Wage Subsidy Scheme

The Temporary Wage Subsidy Scheme (TWSS) operates from 26 March to 31 August. Chartered Accountants Ireland sets out the development of the rules for this subsidy in this document

Preliminary statistic published by Revenue indicate that over 663,100 employees received a subsidy payment under the TWSS at a cost of €2.8 billion to the Exchequer.

TWSS Webinars

Take a look at our recording of the webinar hosted on 29 April with representatives from the Institute, Revenue and Grant Thornton.  The accompanying slides are also available to download. The webinar focused on the recent changes to the scheme, the Operational Phase from 4 May, practical calculations of the subsidy amount and answers to members’ common queries.

An earlier webinar was recorded on 8 April. The accompanying slide deck can be downloaded here. See also related video by Gearóid Murphy, Principal Officer in Revenue with oversight on the wage subsidy scheme. (Password: WB2020)

Employment Wage Subsidy Scheme


The Employment Wage Subsidy Scheme (EWSS) succeeds the TWSS from 1 September 2020 and it is set to continue until 31 March 2021.

See our weekly Tax News for updates to the EWSS. 

Chartered Accountants Ireland, in partnership with Sage, hosted a webinar with Revenue on Wednesday 26 August.  The webinar is available now for viewing. 

Revenue Guidelines

Revenue published a booklet, Guidelines on the operation of the Employment Wage Subsidy Scheme, which sets out comprehensive information on qualification criteria and operational criteria.

Revenue also published Guidelines on the operation of the July/August Sweepback as part of the Employment Wage Subsidy Scheme.

Employer eligibility

To be eligible for the EWSS, employers must demonstrate that:

  • their business will experience a 30 percent reduction in turnover or customer orders between 1 July and 31 December 2020; and
  • the disruption is caused by COVID-19.

The reduction in turnover or customer orders is relative to:

  • the same period in 2019 where the business was in existence prior to 1 July 2019;
  • the date of commencement of a business to 31 December 2019; or
  • where a business commenced after 1 November 2019, the projected turnover or customer orders had COVID-19 disruption not arisen.

The turnover test does not apply to employers registered under Section 58C of the Child Care Act 1991. Guidance from Revenue can be sought under an “Other Reasonable Basis” test, where the turnover and customer orders test does not adequately demonstrate the COVID-19 disruption to the business.

Employers must conduct a monthly review to ensure they continue to meet the eligibility criteria under the EWSS and cease making claims where the 30 percent reduction test is not achieved.  It is possible to re-register for the EWSS; however, Revenue confirmed that claims will not be backdated in these situations.

PAYE must be operated by the employer on subsidy payments forming part of wages to employees.  This means PAYE, USC and employees PRSI is operated by employers and the employee receives wage/salary net of tax.  A 0.5 percent rate of employers PRSI applies for employments eligible for the EWSS operating on a credit basis – see Revenue Guidelines for more details.

The subsidy support amounts are set out in the table below

Employee gross weekly wages Subsidy payable
Less than €151.50 Nil
From €151.50 to €209.99 €151.50
More than €204 and less than €1,462 €203
More than €1,462 Nil

Subsidies received are taxed on employers as part of their trading income but are ignored in the calculation of the 30 percent reduction in turnover test.

Level 5 revisions to the EWSS

The payment rates under the EWSS changed as a result of the imposition of Level 5 public health restrictions. The revised rates under the EWSS are effective from the next payroll date after 19 October and will run to the end of January 2021.

The revised payment rates/bands are as follows:

Employee gross weekly pay

Subsidy payable

Less than €151


€151 - €202.99


€203 - €299.99


€300 - €399.99


€400 - €1,462


Greater than €1,462


Employee eligibility

The EWSS provides a subsidy for new and seasonal employees, in addition to existing employees.

Revenue’s guidelines confirm that the EWSS can be claimed for certain proprietary directors in line with Minister Donohoe’s press statement.

There are no restrictions on the movement of employees under TUPE legislation. Employees employed otherwise than as part of a business, such as childminders, housekeepers, gardeners etc., are not eligible employees for the EWSS.

Proprietary Directors 

According to Revenue’s press release, an employer may claim a subsidy for an employee who is a proprietary director where the following conditions are satisfied:

  • 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 1 July 2019 and 30 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.

Further expanded employer guidelines, including additional information on the inclusion of proprietary directors in the scheme, is expected to issue shortly.

Tax Clearance

Unlike the TWSS, employers must have a tax clearance certificate to be eligible to join the EWSS. Employers who qualify for tax debt warehousing and/or have a phased payment arrangement in place for non-COVID-19 tax debt will still be regarded as tax compliant for tax clearance purposes. Employers must maintain this tax compliance status through the course of the scheme to continue receiving EWSS benefit.

Employers are encouraged to apply for tax clearance as early as possible to allow time for the identification and submission of any outstanding tax returns or payment of tax debts.

Tax clearance status can be checked in ROS – after logging in, current tax status is displayed above the grey banner for “My Frequently Used Services”. An application for a tax clearance certificate can be made through the eTax clearance service in ROS.

Registration for EWSS

Registration commenced through ROS on 20 August. This process is separate to obtaining tax clearance. Employers are required to agree a declaration, as set out in the guidelines, as part of the registration process. Registration applications will only be processed if the employer is registered for PAYE/PRSI as an employer, has a bank account linked to that registration, and has tax clearance.

July/August Sweepback

Employers who are eligible and registered for the EWSS can backdate a claim to 1 July 2020 for newly or seasonally hired employees not previously included in the TWSS.  This is called the sweepback facility and opened on 15 September. 

Employers must complete a Sweepback template with eligible employee’s name, PPSN and employment ID. From 15 September, the completed templates can be uploaded to ROS via a new facility in Employer Services. Once the templates are uploaded to ROS, Revenue will calculate the total subsidy due and make the relevant payment to the employer’s designated bank account as soon as possible after 16 September. Revenue will also credit the difference between the employer PRSI already returned and the reduced rate of 0.5 percent due under the EWSS against the employer’s PRSI liability for August 2020.

 Applications under the Sweepback facility must be submitted through ROS before 14 October 2020.

Further information on the Sweepback facility can be found in the Guidelines on the operation of the July/August Sweepback as part of the Employment Wage Subsidy Scheme.

Revenue checks

Revenue will undertake assurance checks in relation to the scheme. Accordingly, all records relating to the scheme must be retained. Further details on this compliance check programme will issue later. The scheme will be administered by Revenue on a “self-assessment” basis. Revenue will not be looking for proof of eligibility at the registration stage but will in the future, undertake a risk-based approach to reviews of employer eligibility.

Publication of employers

A list of employers availing of EWSS will be published in January 2021 and April 2021 to www.revenue.ie.

COVID-19 tax under the spotlight podcast

Listen to our podcast where senior Revenue officials Anne Dullea and Gearoid Murphy joined Chartered Accountants Ireland to talk through eligibility criteria for the TWSS, along with common operational issues on running the scheme. (This recording is based on Revenue Guidance as at the date of recording on Wednesday 17 June).

In the media

RTÉ's News at One interviewed Brian Keegan, Director of Public Policy on April 22 about the tax implications of the government's Pandemic Unemployment Payment and the Wage Subsidy Scheme. You can listen to the interview here

RTÉ’s Morning Ireland interviewed Norah Collender, Professional Tax Leader on June 24 about the TWSS compliance programme initiated by Revenue. You can listen to the interview here.

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