Overview of the EWSS
As the Country is in the middle of its third national lockdown, businesses are experiencing the economic fall-out from the pandemic. In order to protect their business in the long term, many employers face very difficult decisions regarding their employees.
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.
Where the business has been closed, or trading has been severely curtailed as a result of the current restrictions, employers should review their position to determine if the business meets the relevant eligibility criteria for the EWSS scheme. For employers who have made the decision not to temporary layoff their employees, the EWSS scheme may provide employers with a vital source of financial support.
In order to be regarded as a qualifying employer, the forecasted turnover or customer orders for the business in the period 01 January – 30 June 2021 must be 30% less than the same period in 2019. If the business commenced trading on/ or after 01 January 2019, specific rules apply.
At the end of every month, the business must review its expected financial performance for the period 01 January – 30 June 2021 on a real-time basis. If it appears likely than the 30% test will not be met, the business must de-register for the scheme. When determining if there will be a 30% reduction in turnover, the business must take into consideration any grants or state aid funding (excluding the EWSS subsidy payments and the Capital Restart Grant) the business received or is likely to receive.
The subsidy is based on the principle that the qualifying employer receives a flat rate subsidy per qualifying employee. The rate of the subsidy will depend on the employee’s gross weekly salary. Set out in the table below is an overview of the subsidy payments
|Employee Gross Weekly Wage||Subsidy Payment|
|Less than €151.50||€0|
|€151.50 to €202.99||€203|
|€203 to €299.99||€250|
|€300 to €399.99||€300|
|€400 to €1,462||€350|
|Greater than €1,462||€0|
Operation of the Scheme
Employers that meet the relevant eligible criteria, or their tax agents, may apply for the scheme directly through ROS. All employers should be regarded as qualifying employees, provided their gross weekly salary is greater than €151.50 but less than €1,462. Revenue has confirmed that the subsidy may be claimed by proprietary directors and related family members, provided they were in receipt of a salary from the business between July 2019 and June 2020.
As part of the payroll submission, the employer must indicate that the business is participating in the EWSS scheme. Any subsidy payments due to the business should be advanced by Revenue two days after the payroll submission has been filed.
In addition, as part of the scheme, the rate of ER PRSI has been reduced to 0.5%. Following the payroll submission, Revenue will compute the excess ER PRSI paid by the employer for the relevant period and issue a refund thereafter.
The business must hold a valid tax clearance certificate.
By applying for the scheme, the business may be subject to a subsequent Revenue Compliance Check. Therefore, the employer must be in a position to provide Revenue with supporting documentation illustrating the expected decrease in turnover and customer orders for the business.
If you would like to discuss the EWSS scheme in further detail please feel free to contact us on 021 486 1486 or email info@MC2group.ie.