17th April 2020
Temporary COVID-19 Wage Subsidy Scheme
Effective from 4th May 2020
The Wage Subsidy Scheme came into operation on the 26th March 2020 and provided financial support to Irish Companies affected by the Covid-19 crisis who, otherwise, may be unable to pay employees their wages arising from the COVID 19 crisis, and allows employers to continue to pay employees and to re-employ employees who may have been laid off. This scheme has again been updated on the 15th April and these updates come into effect on the 4th May 2020 and run to the 26th June 2020. For April pay runs please refer top our Update of the 6th April 2020.
Employers must keep employees on the payroll throughout the COVID-19 pandemic so that employers retain their links with employees for when business picks up after the crisis and are encouraged to top up the subsidy, if they can, for the period of the scheme. A revised summary of the operation of the scheme is as follows: -
New Scheme Details
o 85% of net pay to a maximum of €350 per qualifying employee, where the employee’s normal net pay was €412 p.w. or less
o 70% of net pay to a maximum of €350 per employee where the normal net pay was between €412p.w. and €500 p.w
o 70% of net pay to a maximum of €410 per employees where the normal net pay was between €501p.w. and €586 p.w
o 70% of net pay for employees with previous net pay between €586 - €960 per week subject to a maximum that is based on a tiered approach which varies the maximum depending on the amount paid by the employer and the level of any reduction in pay that has been imposed on that employee as follows:
Gross amount paid by the Employer Subsidy Max
Up to 60% of normal net €350
Between 60%-80% of net €205
Who does the scheme apply to?
The Scheme is open to businesses, excluding the public service and non-commercial semi-state sector, who are being adversely impacted by the pandemic and they: -
The employer meets the conditions set out below and subject to the levels of pay given to the employees.
The names of employers operating this scheme will be published on Revenue’s website in due course, after the scheme has expired.
Any employer, already registered with Revenue for the Employer COVID-19 Refund Scheme, is not required to take any further action. The employer may make payroll submissions from 26 March 2020 under the subsidy scheme arrangements on the same basis as they were doing for the Employer Refund Scheme.
Employers wishing to register for the scheme can apply to Revenue by logging on to ROS myEnquiries and select the category ‘Covid-19: Temporary Wage Subsidy’.
Operating the scheme from Thursday 26th March 2020
Transitional Phase - The employer runs the payroll as normal, entering the following details for each relevant employee under the Scheme:
The payroll submission must include pay frequency and period number and will not be processed for refund until 4 days before the pay date.
Normal Weekly Net Pay
This is the Average Net weekly pay for January and February 2020 based on revenue returns by 15th March 2020.
The payment of the Temporary Wage Subsidy and any additional income paid by the employer may result in the refund of Income Tax or USC already paid by the employee. Any Income Tax and USC refunds that arise as a result of the application of tax credits and rate bands can be repaid by the employer and Revenue will also refund this amount to the employer.
Employers must not operate this scheme for any employee who is making a claim for duplicate support (e.g. Pandemic Unemployment Payment) from the DEASP.
Where an employee is not covered by this scheme they may still be able to avail of the Covid 19 Pandemic Unemployment Payment or Short-time Work Support/Job Seekers benefit.
Please note Penalties will apply to any abuse of the Subsidy Scheme by self-declaring incorrectly, not providing funds to employees or non-adherence to Revenue, and any other relevant, guidelines.
This update is for guidance only and is
provided by the MSS HR Support Service
Further details on the update or about our services may be obtained from:
John Barry/Tara Daly/ Hugh Hegarty at Tel: 01 8870690
Email: firstname.lastname@example.org Website: www.mssirl.ie
Useful links for more information:-