Month: March 2020

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Local Property Tax deferred Covid-19

Revenue have confirmed that payments of Local Property Tax paid by single direct debit have been deferred due to Covid-19.

This will now be due for collection on 21st May 2020

If this applies to you, there is no need for you to do anything further as this will automatically be deferred to the new payment date.

This has been implemented to reduce pressure on property owners amid the coronavirus outbreak.

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Covid-19 Wage Subsidy Scheme

What is it?

It will be operated by employers through their payroll system, therefore ensuring employees will be in receipt of the subsidy payment along with their weekly employer contribution of wages, with effect from 26th March 2020.

What are the key elements?

Where the employer’s business has been adversely affected by Covid-19, the subsidy scheme will provide income supports to their employees. The subsidy will be included as part of the employees’ wages in addition to the amount the employer would be able to pay. The subsidy payment will be stated seperately on an employees payslip as ‘Non-Taxable Pay’

It is open to all employers that can show that the Covid-19 Pandemic has led to a minimum 25% decline in actual or predicted turnover, resulting in difficulties in meeting outgoings and paying wages. Further conditions are due to be clarified by Revenue shortly.

Employer Refund Scheme

This scheme now supersedes the Employer Covid Refund Scheme as it;

  • Increases the maximum non-taxable refundable payment to €410 or 70% of the employee’s Average Net Weekly Pay if less than €410 for employees earning less than or equal to €586 per week net.
  • Increases the maximum non-taxable refundable payment to €350 or 70% of the employee’s Average Net Weekly Pay if less than €350, for those earning over €586 per week net and less than or equal to €960 per week net.
  • Allows the payment by employers of additional taxable payments.

Employers that had already registered for the Employer Refund Scheme and may have received refunds are eligible for this scheme. They are not required to apply again. Revenue will confirm with the employer that they meet the new conditions.

Phasing in the Wage Subsidy Scheme

There will be 2 phases to this scheme;

Phase 1 –           transitional phase that adds onto the Employer Refund Scheme in effect since 15th March 2020, under which the employer got a refund of €203 per week per employee it kept on payroll. The subsidy scheme is increasing this to €410 maximum regardless if the employer makes an additional payment to the employee or not.

Phase 2 –           The scheme is aiming to be in operation no later than 20th April 2020 and subsidies paid to each employee will be based on their average net weekly pay, subject to the maximum weekly amounts. There will be further updates on this Phase issued shortly.

‘Top-Up’ Payments

In Phase 1, an employer may choose to make a taxable payment to their employee(s) to make up the 30% difference between the 70% of the average net weekly payment issued by the subsidy scheme and the employee(s) normal average net weekly wage.

If the employer makes a taxable payment greater than the 30% difference, the subsidy amount due to be refunded to the employer will be reduced by the extra payment.

The employer is not required to make this ‘top-up’ payment to his employee(s) to be eligible for the scheme but it is hoped that employers will attempt to keep their employees income as close to 100% as possible. There is also no minimum payment but when running payroll, an employer will need to enter €0.01.

How do Employers Register for the Scheme?

Employers or their agents need to apply directly to Revenue.

Re-hiring of staff

If an employer has already laid off their employees as a result of Covid-19, they can be placed back on payroll and qualify for this subsidy providing that they meet the criteria and were on payroll at the end of February

Duration of Scheme

The Wage Subsidy Scheme is due to be in operation for 12 weeks.

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e-Working and home workers

In this extraordinary time, employees are now unexpectedly working remotely from home. So, what does this mean for employees and employers?

What is an e-worker?

This is where an employee;

  • Works from home full or part time
  • Works on the move, with visits to normal place of work

What is e-working?

This is where your work involves;

  • Working for substantial periods outside normal place of work
  • Working remotely and logging on to work computer
  • Sending & receiving emails & data remotely

An employer can provide any of the following to an e-worker for business use;

  • Computer/laptop
  • Printer/Scanner
  • Phone/Mobile/Broadband
  • Office Furniture

This is not classed as benefit in kind. A payment of €3.20 can be made to the employee per day without deducting PAYE/PRSI or USC. This payment is to cover utilities such as light & heat.

If utilities are higher than this, they can be claimed as expenses once receipts are provided by the employee

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Income Tax Receipts Higher than Forecasted

As reported in the Irish Times, 03.03.2020, the latest exchequer returns show the Government received income tax of €3.97 billion for the months of January & February, 3.3% lower than forecasted but up over 14% based on previous years.

VAT income was up by 4%, generating over €3 billion, with Corporation Tax at €583 million from the start of the year, 117% above forecast.

In total, €9.2 billion in tax was collected, €285 million more than expected.

Revenue have stated that the total received in the last 2 months generally account for less than 2% of a full year of overall receipts.

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