Temporary Wage Subsidy Scheme 4

covid-19 caution

The operational phase of the COVID-19 Temporary Wage Subsidy Scheme began on the May 4th.
The main differences between Transition and Operational phases are.

  • Revenue have issued a CSV file containing the subsidy details for all employees currently employed by the company on the 1st of May 2020. These details were previously determined by the employer.
  • Revenue will refund the exact amount of subsidy and tax refunds after each payslip submission. Previously they had refunded €412 plus tax refunds.

A new Revenue FAQ and examples have been published here:
https://www.revenue.ie/en/news/articles/guidance-on-the-temporary-covid-19-wage-subsidy-scheme.aspx

The Parolla Setup guide can be found here: https://writer.zohopublic.com/writer/published/jzkzi26d2a4914919497897c5a8a05ee8fcaa

Differences in the €0 to €586 band:

  • A higher subsidy amount of 85% capped at €350 for those with an Average Revenue Net Weekly Pay (ARNWP) of less than €412. This was previously a maximum of 70% capped at €410
  • For those with an ARNWP of between €412.01 and €500 the subsidy is a flat €350
  • For those with an ARNWP between €500 and and €586 the subsidy is 70% of ARNWP.
  • The employer can make additional contributions to bring an employee up to €350 pay without tapering occuring.

Difference in the €586 to €960 band:

  • The band has been split into three subsidy tiers based on the amount of employer contribution as a percentage of the ARNWP.
  • Where the employer contributes less than 60% of the ARNWP then the subsidy entitlement is €350.
  • Where the employer contributes between 60-80% of the ARNWP then the subsidy entitlement is €205.
  • Where the employer contributes more than 80% of ARNWP then the subsidy is zero.
  • Previously this was a flat €350.

Difference in the €960+ band:

  • Originally this band has no subsidy but the operational phase was brought foward by Ministerial determination on the 16th of April.
  • An employee with an ARNWP higher than €960 can be eligible for a subsidy if their income reduces by more than 20% and becomes less than €960 per week.
  • Where the employer contributes less than 60% of the ARNWP then the subsidy entitlement is €350.
  • Where the employer contributes between 60-80% of the ARNWP then the subsidy entitlement is €205.
  • Where the employer contributes more than 80% of ARNWP then the subsidy is zero.

Tapering

  • Tapering occurs where the additional employer contribution is greater than the “Maximum Weekly Employer Pay Before Tapering”.
  • The impact of the tapering is to reduce the subsidy when the employer contributes more pay, until such a point as the employer is paying the full ARNWP and the employee no longer qualifies for the scheme.
  • To set up the operational phase
  • Read the latest FAQ here.
  • Register for the Temporary Wage Subsidy Scheme on ROS if you haven’t already done so.
  • Provide bank account details for the refund to be deposited to. This can be the same bank details as the direct debit mandate, but they need to be entered into the refund fields.
  • Download the Revenue CSV file, see Appendix A2.2 of the FAQ for instructions or the Parolla Guide, found here.

Employer Contributions?

The emphasis of the new system has changed so that the employer contribution defines the level of subsidy available and any tapering that is applied.

In the Parolla setup page you can:

  • Enter your own level of employer contribution.
  • Click the green button to set the maximum contribution that gets the maximum subsidy.
  • Click the orange button to maximise the employee pay. This may result in a reduction of the subsidy.
  • Leave the field empty, or enter zero, for subsidy only.

You can view the CSV details behind the calculations by using the information button to the right of each employee.

The system went live today, and is significantly different from the Transition phase. Please contact us if you require any assistance.

Previous post can be found here.

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