Dáil Éireann Debate, Wednesday - 5 May 2021
211. Deputy James O'Connor asked the Minister for Finance if he will address a matter regarding the temporary wage subsidy scheme in the case of a person (details supplied); and if he will make a statement on the matter. [22798/21]
View answerThe Temporary Wage Subsidy Scheme (TWSS), which operated from 26 March 2020 to 31 August 2020 provided income support to eligible employees whose employers were negatively affected by the COVID-19 pandemic. The scheme was replaced by the Employment Wage Subsidy Scheme (EWSS) from 1 September 2020.
Under the scheme, employers were expected to make best efforts to maintain their employees’ net income by ‘topping up’ the subsidy payment where possible. However, there was no legal requirement to do so as many businesses were closed and had no financial capacity to make the payments. Any ‘top up’ payments made to employees by employers were taxed in the normal ‘real time’ manner while the TWSS payments were not taxed until year end. These TWSS related tax liabilities are correctly owed by the employee rather than the employer.
I am advised by Revenue that the person in question has an outstanding tax liability of €1,220.44 for 2020. This liability comprises tax due on TWSS payments and Pandemic Unemployment Payments (PUP) received by the person concerned as well as Department of Social Protection (DSP) Illness Benefit payments received by the person’s spouse in 2020. This outstanding liability is to be collected, interest free, by reducing the persons tax credits by €305.11 per year, or €5.87 per week, over four years commencing on 1 January 2022.
Finally, while the tax and USC liabilities arising from TWSS payments received in 2020 are correctly owed by employees, Revenue will facilitate employers who voluntarily wish to pay some, or all, of these liabilities on their behalf, including the non-application of Benefit in Kind rules to the payments. However, any such arrangement, including the method of payment must be agreed in advance between both parties.
