All you need to know about The Employment Wage Subsidy Scheme (EWSS)

What is the Employment Wage Subsidy Scheme (EWSS)?

 

The Employment Wage Subsidy Scheme (EWSS) is an economy-wide enterprise support that focuses primarily on business eligibility. The scheme provides a flat-rate subsidy to qualifying employers based on the numbers of eligible employees on the employer’s payroll and gross pay to employees.

The EWSS replaced the Temporary Wage Subsidy Scheme (TWSS) from 1 September 2020. It is expected to continue until 30 June 2021.

How to qualify

Employers

Employers must have tax clearance from Revenue. You can check your tax clearance status through Revenue Online Service (ROS). If you do not currently have tax clearance, you can make an application using the eTax clearance service.

Qualifying criteria from January 2021

From 1 January 2021, the period to be reviewed to determine eligibility for EWSS will be 1 January to 30 June 2021. Tax clearance is still a requirement in order to be eligible.The reduction in turnover or customer orders (30%) between 1 January and 30 June 2021, is shown compared to the:

  • same period in 2019, where the business operated for the whole of the comparable period in 2019

period from the date of commencement to 30 June 2019, where the business commenced trading between 1 January and 1 May 2019

  • projected turnover or customer orders from 1 January 2021, or date of commencement, to 30 June 2021, where business commenced after 1 May 2019. (This is compared to what projections may have been if COVID-19 had not occurred.)

You are required to undertake a review on the last day of every month to ensure you continue to meet the eligibility criteria.

July 2020 and the final month of the EWSS are exempt from this requirement.

Qualifying childcare businesses

Childcare businesses, registered in accordance with Section 58C of the Child Care Act 1991, are included in the scheme. There is no requirement to meet the turnover test but other eligibility criteria such as regitration and tax clearance must be met.

Employees

Employees are eligible if they are in receipt of weekly gross wages between €151.50 and €1,462. This is subject to exemptions.

There is no legislative requirement that employees are actively working to be eligible for the EWSS.

No subsidy is paid for employees paid less than €151.50 or more than €1,462 gross per week.

Proprietary directors

The subsidy can be claimed for certain proprietary directors. This was agreed in recognition of the key role played by certain proprietary directors in providing employment. Especially in the small and medium enterprises (SME) sector.

You can claim the subsidy for proprietary directors if:

  • you meet the eligibility criteria for the EWSS

and

  • the proprietary director is on your payroll

and

  • you paid wages to the proprietary director which were reported to Revenue on your payroll at any stage between 1 July 2019 and 30 June 2020.

Newly hired connected parties

These are connected parties who were not on the payroll and paid at any time between 1 July 2019 and 30 June 2020. Connected parties include, an individual’s or their spouse’s:

  • brother or sister
  • aunt or uncle
  • niece or nephew
  • linear ancestor or descendant.

Employees employed otherwise than as part of a business

Examples of these employees, are domestic employees such as:

  • childminders
  • housekeepers
  • gardeners

Register

Employers

You, or your authorised payroll agent, can now register for the EWSS through Revenue Online Service (ROS). As part of the registration process, you or your authorised agent will be required to make a declaration.

Applications will only be processed if you:

  • are registered for Employer Pay As You Earn (PAYE) and Pay Related Social Insurance (PRSI)
  • have a bank account linked to that registration
  • have tax clearance

You must retain supporting evidence of your basis for entering and remaining in the scheme. These will be required for any future compliance and verification checks.

If an EWSS payment submission is filed without first registering for the EWSS, it will be rejected in full.

As registration cannot be backdated, you must register for the EWSS prior to the first pay date for which the subsidy is being claimed.

Employees

To indicate that an EWSS subsidy is being requested for an eligible employee, you:

  • must include ‘EWSS’ as the payment type in the ‘Other Payments’ section on the payroll submission
  • input €0.00 or €1.00 (depending on the capability of the payroll package) as the value of the corresponding ‘Other Payment’ made
  • must not include the EWSS ‘Other Payment’ details on the payslip you provide to the employee.

Rates

The subsidy amount paid to you will depend on the gross income of each employee. The EWSS will give a flat-rate subsidy to you, based on the number of qualifying employees on your payroll.

No subsidy is paid for employees paid less than €151.50 or more than €1,462 gross per week.

If you no longer qualify

You may find, after your monthly review, that you no longer qualify. If this is the case, you must:

  • deregister from the EWSS
  • cease claiming the subsidy.

You must do this through ROS, with effect from the following day of the review (that being the first day of the month).

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