TWSS Reconciliation update
Revenue released the reconciliation process for the Temporary Wage Subsidy Scheme (TWSS) and sent reconciliation statements to employers in mid-March 2021. These reconciliation statements were issued directly to employers Revenue Online Service (ROS) inbox instead of by post.
The TWSS was designed to assist employers impacted by COVID-19 and to encourage employers to keep their employees on the payroll. These reconciliation statements compared what Revenue have paid to employers against what Revenue say the employer was entitled to receive whilst availing of the TWSS.
When the TWSS was first introduced back in March 2020, during the transitional phase, Revenue refunded a flat rate of €410 per employee per pay period regardless of the employees' earnings.
In a lot of cases this €410 exceeded the subsidy that the employee was entitled to receive, and it was made very clear from the start that there would be a reconciliation to rectify this overpayment. After that period, Revenue revised the scheme, and the TWSS was based on the average weekly net pay which could be topped up.
The TWSS reconciliation process is nearing completion. Employers have until the 30th June 2021 to review, correct and accept their TWSS reconciliation. If an employer does not accept the reconciliation on or before 30th June, Revenue will deem it to be accepted. Revenue consider any TWSS liability up to €500 as balanced and no repayment is due. Where the outstanding liability exceeds €500, Revenue will notify the employer and normal enforcement and collection processes will begin. Employers who have yet to accept their TWSS reconciliation should take action as soon as possible as it may take a period of time to complete the reconciliation, especially where it is not currently balanced. If no subsidy paid data is reported then Revenue will recover all payments. If the TWSS reconciliation is not accepted Revenue will continue with normal collections and enforcement processes will begin. Quintas payroll department has undertaken the reconciliation for their payroll clients and some extra requested ones.
EWSS Update
The EWSS scheme replaced the TWSS. The Employment Wage Subsidy Scheme (EWSS) does not have the same tax implications as the TWSS as this is a subsidy paid to employers rather than employees. The EWSS will not appear on the employee’s payslip and the scheme has been extended until 31st December 2021. The EWSS is currently based on a gross pay tiered pay rates which have been in affect from 20th October 2020 up to 30th September 2021 as follows:-
Employers Gross Weekly wages Subsidy
Less than €151.50 €0
From €151.50 to €202.99 €203
From €203 to €299.99 €250
From €300 to €399.99 €300
From €400 to €1462 €350
Over €1462 €0
To qualify for the EWSS, businesses must expect to experience at least 30% reduction in turnover/customer orders by comparing the actual reported turnover for the period January to December 2019 against the Financial predictions for the period January to December 2021 and have a valid tax clearance certificate. The eligibility for the EWSS must be reviewed on the last day of each month. If the business is no longer eligible then the business must de-register for EWSS from the following day. If circumstances change then the business can re-register again.
The EWSS is indicated in the payroll submission report to Revenue and Revenue will calculate the subsidy due based on the gross pay, pay frequency and insurable weeks. EWSS will generally be paid to the employer within two workings days of the payroll submission. A 0.5% rate of Employer PRSI applies for employments that are eligible for the subsidy and this will be refunded on the statement of account as a credit.
Kind Regards,
Sally Turner
