Ireland: Covid-19 Wage Subsidy Scheme

26 Mar 2020 | Covid-19, Funding

This week, the Government announced new measures to provide financial support to workers affected by the Covid-19 crisis, including a scheme run by the Revenue, called the Temporary Wage Subsidy Scheme.

**Please Note: The information in this blog is taken directly from Revenue.ie. Please refer back to Revenue.ie for more detailed information and specifics. (Correct as of Thursday, 26 March 2020).

The new scheme announced on Tuesday will allow employees whose employers are impacted by Covid-19 to get significant supports directly from their employer for 12 weeks beginning today - 26th of March 2020. 

The information that follows is based on the terms of the Emergency Measures in the Public Interest (Covid-19) Bill 2020 (As initiated) which was recently published.

The Temporary Wage Subsidy Scheme means that employers can retain links with employees for when business picks up after the crisis. 

The Revenue states: “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 points of the scheme:
  • Replaces the previous COVID-19 Refund Scheme.

  • The subsidy scheme will refund employers up to a maximum of €410 per each qualifying employee for 12 weeks beginning on the 26th of March. 

  • No more than the normal weekly net pay of the employee should be paid.

  • The subsidy scheme applies both 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 normal net weekly 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.

  • Employer’s PRSI will not apply to the subsidy and will be reduced from 11.05% to 0.5% on the top up payment.

* (details on this will be made available by Revenue in due course)

Is this Applicable to Arts Organisations?

The scheme is available to all sectors who have been impacted by Covid-19. 

This to allow employers to retain staff on payroll who may not be able to work during the crisis or who may have reduced pay or reduced hours. There are some conditions that employers must meet as outlined by the Revenue below. 

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 and

  • retain their employees on the payroll.

The Scheme applies 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.

Registering for the Temporary Wage Subsidy Scheme

Please visit: Temporary Wage Subsidy Scheme to learn how to register and set up your payroll to avail of the scheme. 

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