Covid-19 Wage Subsidy Scheme for Employers
So, it’s taken a global pandemic for me to write my first Metis Ireland blog. Obviously, I wish the reason was for something entirely different, but this is where we all find ourselves, in unchartered territory. I’ve found myself signing off all emails lately with “we’ll get through this together” and that we will. I’m absolutely 100% convinced of this.
It’s times like these that we need everyone rowing in the same direction and pulling for one another.
Part of my role at Metis Ireland as Financial Controller is to offer professional guidance and assistance to our Board of Management in relation to all things financial relating to Metis Ireland. Today, I can offer this professional guidance and assistance to our clients and prospective clients.
As like many Financial Controllers around the world over the past week, I’ve been frantically re-evaluating budgets, updating cashflow forecasts and looking at any measure that can best serve our company and clients. I’ve been waiting the last 48 hours for the Irish Government to announce their updated Covid-19 wage subsidy scheme, as I knew this could be a game changer, not only for Metis Ireland but also for many clients and Irish businesses. And it is – a game changer!
By now, you will have all seen that in order to try and minimise unemployment, qualifying companies (who are adversely affected by the pandemic) will be refunded up to 70 percent of an employee’s wages – up to a maximum level of €410 per week. This will operate for the next three months.
An employee earning €38,000 would normally cost a company €3,517 per month (€3,167 plus Employers PRSI) and would take home €2,552 (after tax).
Under the new scheme, for the same employee to take home €2,552, it will now only cost a company approximately €920 a month (a saving of €2,597 per month for this employee). The Revenue will release the exact details this week.
How to roll this out for your company – I’ve broken this down into five stages:
1. Establish if your company qualifies for the subsidy
2. Do the relevant Revenue registration declarations and get your house in order (bank details for refunds and update payroll software)
3. Prepare the application of the scheme for each qualifying employee (following the key features)
4. Implement the subsidy scheme via your payroll software (including the Revenue payroll submission)
5. For cashflow purposes, ensure the refund is received before you actually make salary payments (this is achieved by filing Revenue submission in advance of the actual pay date)
For point one above – in order to qualify for the scheme, employers must:
Now, in these crucial times for humankind, the last thing we want is abuse of this critical initiative for so many workers and their families. Honesty is required. If your company does not qualify, don’t use the scheme. The Revenue has indicated that severe penalties will apply to any abuse of the subsidy scheme.
The scheme comes into effect on Thursday 26th March and employers are advised to wait until the details and payroll software providers have the relevant updates before filing this month.
I’ve read this thing inside out, from the government websites to the Revenue guidelines. I wish I was able to do more, like our incredible health care workers, but I’m here to help and assist anyone who wants a bit of guidance or even just reassurance with any of this. Give me a call and we can work down through each of the five stages I’ve outlined above.
We’ll get through this together.
Financial Controller, Metis Ireland
Metis Ireland Financial Planning Ltd t/a Metis Ireland is regulated by the Central Bank of Ireland.
All content provided in these blog posts is intended for information purposes only and should not be interpreted as financial advice. You should always engage the services of a fully qualified financial adviser before entering any financial contract. Metis Ireland Financial Planning Ltd t/a Metis Ireland will not be held responsible for any actions taken as a result of reading these blog posts.