Revenue provide important information on extension of TWSS, including employer compliance programme to ensure correct operation of scheme
Today (23/06/2020) Revenue has provided an update on a range of matters relating to the Temporary Wage Subsidy Scheme (TWSS). These include:
- The extension of the current scheme until 31 August 2020
- Confirmation of the scheme’s eligibility criteria for the duration of the extension
- How employers can stop claiming TWSS
- Tapering of subsidy payments as normal business resumes and employers begin to increase the amount of wages that they are paying
- The issue of revised tax credit certificates for employees in receipt of payments under TWSS
- A new facility in myAccount for employees to look up their TWSS payments
- Changes to the scheme to incorporate apprentices returning to work following the completion of a SOLAS education and training programme
- Employer Compliance Programme
- Latest TWSS Statistical Report.
On 5 June 2020, the Minister for Finance and Public Expenditure and Reform, Paschal Donohoe T.D., announced the extension of the Temporary Wage Subsidy Scheme until the end of August. Revenue will continue to administer the scheme until 31 August 2020, reimbursing employers for subsidy amounts paid to eligible employees, notified to Revenue via the payroll process.
The eligibility criteria for continued participation in the scheme, or to now join the scheme, remains unchanged and continues to relate to the level of negative economic disruption suffered by the employer due to Covid-19 the period April – June 2020.
The scheme remains applicable to employees who were on the employer's payroll at 29 February 2020, and for whom a payroll submission was made to Revenue in the period from 1 February 2020 to 31 March 2020.
When the scheme was announced in March, employers joined based on the principles of self-assessment and a best estimate determination in relation to a decline in turnover, customer orders or any other ‘reasonable basis’ measurement. Revenue has advised employers that as the end of Quarter 2 approaches, it is timely to review their eligibility for the scheme and determine whether they did in fact meet the eligibility criteria.
Where, following a review, an employer determines that the eligibility criteria were met, they can continue to avail of the scheme for the extension period. If an employer determines that the eligibility criteria were not met but had reasonable grounds for assuming the criteria would be met, the employer should now cease claiming the subsidy for the extended scheme. Revenue will not seek to claw-back the subsidy paid to such employers where evidence of the best estimate determination supporting the original application is found to be reasonable. If there was not a reasonable basis the subsidy is repayable to Revenue.
How employers can stop claiming TWSS
The scheme is operated by employers entering details into payroll as a non-taxable amount and setting the PRSI class to J9 for eligible employees.
Employers who no longer wish to claim the TWSS or who, following a review, did not meet the eligibility criteria should no longer make payroll submissions using the J9 PRSI class.
Tapering of subsidy payments
The subsidy payment rates remain unchanged for the duration of the extended scheme and continue to be based on the employee’s normal net weekly pay for January and February 2020.
As the lifting of public health restrictions continue, many sectors are beginning to reopen with employees returning to work. Where a business starts to recover from the impacts of the pandemic and the employer’s contribution to the employee’s pay increases, TWSS payments will be subject to tiering and tapering. In the circumstance where an employer pays normal pre-COVID wages, no subsidy is due.
Details of the current TWSS rates and the tapering applicable having regard to the wages paid by the employer can be found in the ‘Rates of subsidy from 4 May 2020’ section on the Temporary COVID-19 Wage Subsidy Scheme page on Revenue’s website.
Revised tax credit certificates for employees in receipt of TWSS and PUP payments
TWSS payments are liable to income tax and Universal Social Charge (USC), while the Pandemic Unemployment Payment (PUP) is liable to income tax. The subsidy and PUP are not being taxed in real-time through the PAYE system and instead will be liable for tax and USC, where applicable, at the end of the year when Revenue automatically reviews their tax position.
With the continuation of the TWSS to the end of August 2020, and to minimise the amount of tax owing that may arise at the end of the year, Revenue will place all employees that received payments under either the TWSS or the PUP on a ‘Week 1 basis’.
Notifications to employers to operate the ‘Week 1 basis’ are available in ROS since 21 June 2020. It is important that employers utilise the most up to date Revenue Payroll Notification (RPN) when running payroll so that employees are correctly switched to the ‘Week 1 basis’. Where an employee is already on the ‘Week 1 basis’ no further action is needed.
New facility in myAccount for employees to look up the TWSS payments
Employers are obliged to show the amount of the TWSS payments on their employees’ payslips. Revenue has very recently provided a look up facility for employees to view details of subsidy payments made on each pay date via their myAccount record.
By clicking on ‘Manage your tax 2020’on the ‘PAYE Services’ card in myAccount and clicking on the ‘View’ link beside the relevant employment, employees can see whether their employer is participating in the TWSS and being refunded a wage subsidy on their behalf. The employee may also be able to see the amount of subsidy paid, where this amount is available from employer payroll submissions made to Revenue.
If employees notice any differences between figures shown in myAccount and those provided to them by their employer they should, in the first instance, contact their employer. If the issue is not rectified to the employee’s satisfaction, the employee can contact Revenue using MyEnquiries under the category 'PAYE (Pay As You Earn) employee/pensioner - Other'' and the sub category 'Employee Payroll Reporting - Compliance'.
Operation of TWSS for apprentices who have been on a SOLAS education and training programme
Following an announcement earlier today by Minister for Finance and Public Expenditure and reform, Paschal Donohoe TD, regarding the operation of TWSS for certain apprentices, Revenue has confirmed that changes to the TWSS are now in place to accommodate apprentices who were on an education and training programme run by SOLAS in February 2020 and, as a result, were not eligible for a TWSS payment as they were not on their employer’s payroll on 29 February 2020.
Employers who wish to access the TWSS on behalf of apprentices covered by these changes can do so as follows:
- log into ROS MyEnquiries
- click Add ‘A New Enquiry’
- select Category ‘Covid-19: Temporary Wage Subsidy’
- select Subcategory ‘TWSS – Apprentices’.
Revenue will calculate a net weekly pay figure for the relevant apprentice, which will be provided to the employer for use in future payroll runs. This information will ensure that the correct wage subsidy can be calculated and paid.
For apprentices who were ceased from payroll and in receipt of the Pandemic Unemployment Payment (PUP), no retrospection will apply as the individual was already in receipt of income support payments. However, employers may rehire these apprentices. Once their PUP claim has been ceased with the Department of Employment Affairs and Social Protection, and the relevant contact made with Revenue by the employer, the TWSS will be applied for these cases.
Any retrospective subsidy payments due to impacted apprentices will be processed by Revenue in due course. This retrospection will apply from 26 March 2020, the date of return to employment or the date the employer was registered for the scheme, whichever is the latest.
Employer Compliance Programme
Over 55,500 employers have already received subsidy payments under TWSS. Revenue will very shortly be contacting these employers to confirm that the scheme is operating correctly and will seek certain documentary evidence to establish that:
- employers participating in the scheme meet the eligibility criteria
- employees are receiving the correct amount of subsidy, and
- the subsidy amount is being correctly identified in employee payslips.
Revenue expects that these contacts will confirm that the vast majority of employers are fully compliant in their operation of the TWSS.
Further detail and information on all the above matters can be found in Revenue eBrief No. 117/20.
TWSS Statistical Reports
Revenue has published updated statistics based on the operation of the TWSS to 18 June 2020. These statistics are published weekly on Revenue's website. Key information reflected in the latest statistics include:
- over 61,300 employers registered with Revenue for the TWSS
- more than 55,500 employers have already received subsidy payments under TWSS
- over 551,800 employees have received a subsidy since the start of the scheme
- approximately 232,400 employees received a subsidy in the last week
- an estimated 410,000 employees are currently being supported by the scheme having received a subsidy in their most recent pay period
- the cumulative value of payments made under the scheme is now €1,589 million
- this includes €142 million in income tax paid that has been refunded over the same time.