The Employment Wage Subsidy Scheme (EWSS) will replace the Temporary Wage Subsidy Scheme (TWSS) from the 01st of September 2020 and is expected to continue until the 31st March 2021. Both schemes will run in parallel from 01st July 2020 to the end of August 2020.
The EWSS differs from the TWSS by the fact that the EWSS provides a flat rate subsidy to qualifying employers while the TWSS makes a payment to eligible employees through their employers.
The Employment Wage Subsidy Scheme has two elements:
- It provides a flat-rate subsidy to qualifying employers based on the numbers of paid and eligible employees on the employer’s payroll; and
- It charges a reduced rate of employer PRSI of 0.5% on wages paid which are eligible for the subsidy payment
The scheme is open to employers who file their payroll submissions electronically through ROS.
The scheme does not affect any legal obligations that the employer may have to the employee as regards any terms, conditions or entitlements of their employment, including pay.
The subsidy will be paid directly into the employer’s designated bank account once a month in arrears, as soon as practicable after the return due date.
Qualifying criteria for employers
To qualify for the scheme, the employer must be able to demonstrate that:
- Your business will experience a 30% reduction in turnover or orders between 01st July and 31 December 2020;
- This disruption is caused by COVID-19; and
- The employer must have a valid tax clearance certificate to enter the EWSS and continue to maintain tax clearance for the duration of the scheme
The reduction in turnover or orders is relative to:
- The same period in 2019 where the business was in existence prior to the 01st July 2019;
- Where the business commenced trading between 01st July and 01 November 2019, the date of commencement to 31st December 2019; or
- Where the business commenced after 01st November 2019, the projected turnover or orders for 01st July 2020 to 31st December 2020.
Continued review of Employer Eligibility required (Important)
Employers are required to undertake a review on the last day of every month (other than July 2020 and the final month of the scheme) to ensure they continue to meet the above eligibility criteria. If employers no longer qualify, they must deregister for EWSS through ROS with effect from the following day (that being the 01st of the month) and cease claiming the subsidy. If the employer becomes aware prior to the end of the month that they will no longer meet the eligibility criteria (e.g. unexpected donation or grant received at the start of a month), they should deregister immediately and cease to claim subsidies.
Subsidies correctly claimed in accordance with the terms and conditions of the scheme prior to deregistration will not be repayable.
If circumstances change the following month(s) and the employer is again eligible, they can reregister and claim from the date of reregistration. It is not possible to backdate the claim to include the period of deregistration as that correctly reflected the employer’s expectation at that time.
A subsidy can be claimed in respect of employees of an impacted business on the payroll and in receipt of gross wages of between €151.50 and €1,462 per week during the period of the scheme.
Level of subsidy the employer will receive
Employee Gross Weekly Wage
- Less than €151.50 – Nil
- From €151.50 to €202.99 – €151.50
- From €203 to €1,462 – €203.00
- More than €1,462 – Nil
The support will be backdated to 01 July 2020 for employees of qualifying employers who did not qualify for TWSS. Payments in respect of July and August are expected to be made by Revenue in mid-September, with payments for subsequent periods being made monthly in arrears thereafter.
A 0.5% rate of employers PRSI will apply for employments that are eligible for the subsidy.
Registration of the Scheme
Eligible employers or their payroll or financial agents will be able to register for the Employment Wage Subsidy Scheme through ROS from the 18th August. As part of the registration process, employers will be required to agree to a revenue worded declaration. Registration applications will only be processed if the employer is registered for PAYE/PRSI as an employer has a bank account linked to the registration and has tax clearance.
Please review the full revenue guidance at https://www.revenue.ie/en/corporate/communications/documents/ewss-guidelines.pdf