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Changes to Employee Wage Subsidy Scheme

Changes to the Employee Wage Subsidy Scheme

As we are all aware, the Employee Wage Subsidy Scheme (EWSS) has been an integral part of protecting Irish businesses during the Covid-19 pandemic emergency. The scheme has seen many changes and taken on new forms over the course of the past year, having been set up on an emergency basis but requiring updates and extensions as the pandemic continues. The latest extension to the EWSS states that The Finance (Covid-19 Miscellaneous Provisions) Act 2021 has allowed for the scheme to be extended through to December 31st, 2021.

With this extension come two major changes to how the scheme will operate going forward. As our country slowly continues the reopening process, these changes will be important to ensure that the scheme is allocated appropriately.

The two new key changes to the EWSS are as follows:

Change to Assessment Period.

The assessment period for eligibility to this scheme has now changed. It is now a requirement to show that your business will incur a 30% reduction in turnover* or orders for the 2021 calendar year as a direct result of Covid-19.
This can be assessed by:

Comparison to the 2019 calendar year if the business was in operation for the full year.
Comparison to the date of commencement to December 31st, 2019, if business commenced between January 1st and October 31st, 2019.
Comparison to projections for the 2021 calendar year, based on the assumption that the Covid-19 emergency had not occurred, if business commenced on or after November 1st, 2019.

*It is important to note that childcare businesses remain exempt from the 30% calculation criteria.

Mandatory Monthly Reviews to be Submitted Online.

A new key criterion to maintaining eligibility for the EWSS is the undertaking of monthly performance reviews for your business to ensure that your business continues to meet the eligibility criteria for this scheme.

A new form (EWSS Eligibility Review Form) has been created for this purpose, which must be submitted online on a monthly basis.

This form must be submitted by August 15th for June’s reviews and following on from this, will be expected by the 15th of each month.

We hope that this information has been useful for you and as always, please don’t hesitate to contact us here at EcovisDCA where we remain open and ready to help. Please do not hesitate to contact us.

For more information visit Revenue.ie

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Wage Subsidy Scheme Extension

The Wage Subsidy Scheme has been vital for the continued survival of many Irish businesses amidst this current crisis, allowing them to keep staff on payroll during a time that otherwise may have necessitated mass layoffs. The scheme was changed to the Employment Wage Subsidy Scheme (EWSS) on September 1st and has now been extended until 31st March 2021, it is not yet known if the scheme will continue past this date.

With the current Level 5 restrictions, the Government announced that the rates for the scheme will be revised to better support businesses, with these new rates becoming effective as of October 19th. In terms of qualifying criteria, the turnover criteria for application is now 25% of the turnover for the same period in 2019.

Finance Minister Paschal Donohoe has said of these changes:

“Consistent with the revised health restrictions that have been announced by Government, a decision has been made to revise the pandemic supports that have been key to sustaining businesses and helping people to manage financially in the midst of this very challenging time. […] The Employment Wage Subsidy Scheme is being enhanced, with a maximum rate now payable at €350, bringing it in line with revisions that are being made to the Pandemic Unemployment Payment”.

Both the extension of and the newly enhanced nature of the scheme are intended to ensure that companies can keep their employees employed where possible and avoid layoffs and employees needing to revert to the Pandemic Unemployment Payment (PUP). It is hoped that these changes will help companies easier transition back to normal business activities when it is safe to do so.

Further information on all Covid-19 pandemic supports can be found on the Revenue website. As always, we here at Ecovis DCA are available should you have any concerns or queries.