The Government introduced special measures to support employers in maintaining employment levels as Covid­19 unfolded globally. The Employer Refund Scheme (March 15th 2020 – March 25th 2020) was replaced by the TWSS on 26th March 2020. The scheme is administrated by Revenue and has undergone various revisions since its introduction with the intention of the scheme lasting 12 weeks. It is most probable that this will be extended.

This special payment is there to support all private sector employers to reduce payroll burden and retain staff on payroll in these most uncertain of times. Employers will receive the subsidy whether their employees are temporarily not working or working reduced hours as long as that employee is retained in employment.

The payment is made to employees via their Employers. Employers can register at any time during the scheme’s operation and before making a payroll submission to Revenue.

The Scheme has seen 2 phases to date:

  1. Phase 1 was the transitional phase that built upon the previous Employer Refund Scheme. Under that scheme, Employers who retained employees on their books received €203 per employee per week. The transitional phase refers to all TWSS submissions received on or before May 3rd 2020. TWSS provided a maximum subsidy of €410 per employee per week in respect of eligible employees for employers partaking in the Subsidy Scheme irrespective of whether or not that Employer made additional payments to the employee or not.
  2. Phase 2 is the operational phase which applies to TWSS submissions received after May 4th 2020. In this phase, the Scheme will ensure that the refunds to Employers is based on each individual employee’s Average Revenue Net Weekly Pay (based on employee net earnings in the January & February payroll) and that the gross pay as reported by each employer in their payroll submissions is subject to the maximum weekly tax­free amounts.

The TWSS is part of an employee’s emoluments for tax purposes however at present that element (i.e. TWSS Subsidy element) is not subject
to pension deductions under PAYE. Furthermore, an Employer is not permitted to deduct an employee pension contribution from the
wage subsidy.

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