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Introduction

A new enhanced COVID-19 scheme has been announced. More information about this scheme can be found here:

https://www.revenue.ie/en/corporate/communications/covid19/temporary-covid-19-wage-subsidy-scheme.aspx

We do not recommend using the scheme unless you absolutely have to. This is because:

  • It is very complex and keeps changing.
  • There is going to be another major change on 4 May (was 20 April)
  • Employees will be taxed on this, just not through payroll.
  • Add too much additional payment and Revenue will reduce the subsidy. This could leave employers out of pocket.
  • Employees may be better off through social welfare: https://services.mywelfare.ie/en/topics/covid-19-payments/

 

If you need to use this scheme, please make sure that you have installed at least version 2020.09 of Payback. The latest version can be downloaded from here:

https://www.payback.ie/support/downloads/

 

Employers adversely affected by COVID-19 can either lay off their employees or use the Temporary COVID-19 Wage subsidy scheme. This new scheme supersedes the old €203/week scheme. 

 

We have developed what is a rather complex new scheme, in a very short time. We are also aware that the details may change again. Due to this, we have tried to make the implementation as flexible as possible. This means that the figures can be over-ridden. If needs be, the scheme can be set up manually by directly entering the elements.

Please note: We have had very little time to test this!

 

Setting up the new scheme

After you have installed (at least) version 2020.07, you will see a new button at the top of the employee screen.

Select the employee you wish to set this scheme up for in the Employee Grid.

Click the new Covid-19 button.

The Covid19 Screen

There are three main tasks to do.

  1. Calculate the Average Weekly Net Pay
  2. Find out if the Average Weekly Net pay is either less than €586, or between €586 and €960
  3. Reduce the non-taxable refundable payment either to €350 or €410 or 70% of the Average Weekly Net Pay

We have tried to automate this. If you have processed all the payments for the employee between 1 Jan 2020 and 29 Feb 2020, then these figures should automatically fill in.

Click the show workings button to see how the Average Weekly Net Pay was calculated.

Average Weekly Earnings

In this example, the employee was fortnightly paid and had four payments. This is eight weeks in total.

The Net pay for this is Gross Pay - (PAYE + Employee NI + USC)

The pay is then averaged for the eight weeks.

If any of the payments are missing, or you do not believe the calculation is correct, you can over-ride the Average Weekly Earnings by clicking the override button.

Paying an Additional taxable payment

In addition to the Non-Taxable refundable payment, there is now the option to also pay the employee a top up - which is the Additional taxable payment portion.

You can optionally top up the employee's pay to their usual net pay.

Tick the box shown to automatically calculate this.

Saving the scheme

When you click save, the following automatically happens:

  • The employee's PRSI class changes to J9
  • The payment method changes to 'Different Amount Each Period', so the Salary or rate details may be lost
  • One, or two new elements are automatically added

DCYA Wage Subsidy Childcare Scheme

For people operating the DCYA subsidy childcare scheme between pay and submission dates between 20 April 2020 to 3 May 2020, you can now top up the subsidy with a taxable payment to bring the employee's payment up to €350 per week.

Payback will allow you to override the additional taxable payment to cater for this.

In the example shown opposite the average net weekly earnings are 300. This means that the non-taxable refundable payment is 210, allowing a top up (using the standard scheme) of 90 (210+90 = 300)

Under the DCYA subsidy scheme, the Additional Taxable Payment can now be over-ridden to 140 (which is 350 - 210). Doing this will not taper the subsidy amount.

In summary, over-ride the weekly Additional taxable payment amount to 350 - Non-taxable refundable payment (subsidy) amount

Notes

  • The Covid19 Temp Wage Subsidy element is not liable to PAYE, PRSI or USC at time of payment.
  • The C19 Additional Taxable element (employer top up) is liable to the usual PAYE and USC rates. For PRSI, the employee rate is zero and the employer rate is 0.5%
  • There should not be any other elements or deductions added. Delete any other elements and deductions  in the employee screen before adding the Covid Payment.
  • LPT, BIK etc, are all suspended for this scheme
  • When you process the payment, the Net pay is likely to differ to previous weeks. This is expected and is happening for tax reasons.
  • If, for example, the employee normally gets €700 the max the employer can pay without the subsidy being reduced is 30% of 700 i.e. 210. If the employer pays 350 the subsidy is reduced by difference between 350 and 210. So in this case the subsidy would be 210 and that is what should be put in the non taxable field.
  • Make a note of the employee salary and rate information as this Covid Utility removes them.

Support

If you have any questions about eligibility, part-time employees, if you can add any other payments etc, please contact the Employer Help line: Phone: 01 738 3638 or 1890 254 565 We really do not know the answers, and may give you incorrect information.

There is likely to be huge volume of support over the next week. If you need to contact support, support tickets can be submitted here for desktop users:
https://www.payback.ie/support/submit-a-ticket/

Cloudpay users should use the built in support ticket system here:
https://www.cloudpay.ie/Support

Tickets will be prioritised.

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