Finance (COVID-19 and Miscellaneous Provisions) Bill 2022 was released on 4 March 2022 and provides a legislative footing to a number of amendments to various COVID-19 business and employer support schemes that have been announced over the last two months. Olive O'Donoghue of our Employment Tax team details the changes below.

Employment Wage Subsidy Scheme

As previously announced, Finance Act 2021 extended the Employment Wage Subsidy Scheme (EWSS) from the original scheme end date of 31 December 2021 to 30 April 2022. On 23 December 2021, Revenue released updated guidance on the operation of the EWSS which will apply to eligible employers who were correctly registered for the EWSS at 31 December 2021. These updated provisions have now been provided for in the Bill.

Specifically, the Bill confirms:

  1. The flat-rate subsidy to be paid for pay dates between 1 January 2022 and 30 April 2022 to qualifying employers;
  2. The reduced rate of employer PRSI of 0.5% applies only to wages paid in respect of eligible employees up to 28 February 2022;
  3. The ability for certain employers who were not eligible for the EWSS as at 31 December 2021 to re-enter the scheme where certain conditions are met; and
  4. Enhanced subsidy rates and a further extension to the EWSS to 31 May 2022 for those businesses that were directly impacted by the public health regulations from 20 December 2021 to 22 January 2022.

Continued eligibility for the EWSS

Employers who met the below criteria as at 31 December 2021 may continue to avail of the EWSS up to 30 April 2022 unless the employer voluntarily opts to de-register from the scheme.

  1. The employer continues to hold a valid tax clearance for the duration of the scheme;
  2. The employer is registered for and received payments under the EWSS; and
  3. The employer meets the qualifying criteria for the reduction in turnover/customer orders at the end of 2021 (i.e. a 30% reduction in turnover/customer orders for the period January – December 2021).

Eligibility for re-entry to the EWSS

In addition to the above, the EWSS is reopened to certain employers who were impacted by the public health restrictions announced on 17 December 2021 and were previously eligible for the EWSS but as at 31 December 2021 were ineligible for the scheme.

To be eligible for re-entry to the EWSS for the period 1 January to 30 April 2022, an employer must be able to demonstrate to the satisfaction of Revenue that:

  • Tax clearance is in place for the duration of the scheme;
  • The trade existed at 31 December 2021;
  • The employer correctly availed of EWSS at any stage between 1 September 2020 and 31 December 2021;
  • The employer did not qualify for the EWSS under the previous scheme rules as they did not expect a 30% reduction in turnover or customer orders value between the calendar years 2019 and 2021;
  • The employer’s business is expected to experience a 30% reduction in turnover or customer orders value in the period from 1 December 2021 to 31 January 2022; and
  • The disruption to normal operations is caused by COVID-19.

This reduction in turnover or customer orders outlined above is relative to:

  • The period 1 December 2019 to 31 January 2020 compared with the period 1 December 2021 to 31 January 2022 where the business was in existence prior to 1 May 2019; or
  • Where the business commenced trading in the period from 1 May 2019 and 31 December 2021, the average monthly actual turnover or orders value from 1 August 2021 to 30 November 2021 compared with the average actual monthly turnover or orders value for December 2021 and projected turnover or orders value January 2022.

If an employer has re-entered the scheme and submitted a payroll prior to Revenue re-registering the employer for the scheme and an EWSS claim was not included in the payroll submission, the payroll submission should be amended to include the EWSS claim.

EWSS rates applicable to most employers

from 1 January to 30 April 2022 (and to 31 May 2022 for certain employers)

The below table summarises the flat rate subsidy payable to eligible employers in respect of eligible employees for the pay dates outlined:

Subsidy rates payable per pay date
Employee gross weekly wage 1 to 31 January 2022 From 1 to 28 February 2022 From 1 March to 30 April 2022
Less than €151.50 Nil Nil Nil
From €151.50 to €202.99 €203 €151.50 €100
From €203 to €299.99 €250 €203 €100
From €300 to €399.99 €300 €203 €100
From €400 to €1,462 €350 €203 €100
More than €1,462 Nil Nil Nil

Enhanced EWSS support for employers impacts

(by restrictions from 20 December 2021 to 22 January 2022)

Most businesses availing of the EWSS support will have moved onto reduced EWSS payments with effect from 1 February 2022. The Bill provides that employers whose business was directly impacted by the specific public health restrictions that existed from 20 December 2021 to 22 January 2022 are entitled to continue to receive the enhanced EWSS subsidy rates for the month of February and will not move onto the graduated rates until March, with the cessation of the scheme for such employers being extended to 31 May 2022.

Employers that are likely to be eligible for this enhanced EWSS include:

  • Restaurants, bars, cafes etc. which were required to close at 8pm
  • Operators of indoor events that were not allowed to hold events after 8pm and who were subject to 50% capacity restrictions
  • Operators of outdoor events, where attendance was limited to 50% or 5,000 attendees
  • Wedding reception venues where capacity was limited to 100 guests and they had to close by midnight

Eligible employers can make the claim for this enhanced EWSS support by the selecting the “EWSS_PHR” on ROS or the “EWSS_PHR” marker if using a payroll software package. Any employers who were directly impacted by the December public health restrictions that already claimed the EWSS at the reduced rates will need to correct the relevant employees’ payslips to select “EWSS_PHR” to ensure they receive the correct subsidy amount.

COVID Restrictions Support Scheme (“CRSS”)

In December 2022, several amendments to the CRSS were announced by Revenue.

The Bill confirms that to qualify for the CRSS from 20 December 2021, a business has to demonstrate that its turnover during the period of restrictions is no more than 40% of the:

  • Average weekly turnover of the business in 2019;
  • For a business established on or after 26 December 2019 and before 13 October 2019, turnover for these businesses will be based on their average weekly turnover from the date of commencement of the business up to 12 October 2021
  • For a business that was established on or after 13 October 2020 and before 27 July 2021, turnover for these businesses will be based on their average weekly turnover from the date of commencement of the business up to 1 August 2021.

This turnover reduction criteria is an increase from no more than 25% of 2019 turnover that applied to periods of restriction prior to 20 December 2021.

In addition, the Bill provides that certain charities and sporting bodies who carry on similar trading activities to businesses are eligible to apply for CRSS for the most recent period of restrictions, December 2021 to January 2022.

Restart weeks

Businesses that have qualified for CRSS in respect of a period of restrictions are, in certain circumstances, eligible to claim an additional week of support under the scheme where the business is recommenced on the lifting of COVID restriction - this is referred to as a “restart week”.  

The Bill provides that where a “restart week” occurs after 20 December 2021 and the business is a charity or approved sports body, or the turnover of the relevant business activity for any claim period commencing on or after 20 December 2021 is between 25 per cent and 40 per cent of the relevant turnover amount, a “restart week” payment equal to one week at the standard rate of the CRSS (subject to a maximum weekly amount of €5,000) may be claimed.

The CRSS scheme ended on 31 January.

Extension of Debt Warehousing Scheme

The Bill provides a legislative footing to the extension of the debt warehousing scheme that was announced in December 2021 for certain businesses who were already eligible for warehousing and who have a valid claim during the period 1 January 2022 to 30 April 2022 for any of the following Government COVID-19 support schemes:

  • EWSS
  • CRSS
  • One of a number of schemes announced by the Minister for Tourism, Culture, Arts, Gaeltacht, Sport and Media in December 2021 and certain schemes operated by Tourism Ireland

The Bill confirms that eligible businesses can warehouse their PAYE and VAT liabilities up until 30 April 2022 (which is an extension from 31 December 2021).  

This should provide those businesses which were most impacted by the additional public health restrictions in place in December 21/January 2022 with an extension to the periods of favourable interest rates that are available under the Debt Warehousing scheme as follows:

  • 0% interest rate will commence from 1 May 2022 and run until 30 April 2023
  • A reduced 3% interest rate will be payable thereafter until the debt is repaid

Get in touch

If you have any queries about the government supports above and their impact for your business, please contact Olive O'Donoghue of our Employment Tax team. We'd be delighted to hear from you.

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