Fergus O'Dowd (Louth, Fine Gael)
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403. To ask the Minister for Finance if he will address a matter in relation to the temporary wage subsidy scheme (details supplied); and if he will make a statement on the matter. [32472/20]

Paschal Donohoe (Dublin Central, Fine Gael)
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The Temporary Wage Subsidy Scheme (TWSS) was legislated for in section 28 of the Emergency Measures in the Public Interest (Covid-19) Act 2020. The scheme was predicated on the employer wanting to keep the employees on the payroll and to retain them until business picked up. The employer was expected to make best efforts to maintain the employee’s net income for the duration of the scheme. Legally, however, there was no requirement for a minimum amount that the employer had to pay as a normal wages payment to an employee to top up the wage subsidy. The reason there was no such requirement was that many businesses were forced to close completely and would have had no capacity to continue to pay employees’ wages. The purpose of the TWSS was to get much needed financial assistance to employees, while retaining the employer / employee relationship which facilitated the early recommencement of normal business when conditions permitted.

I have been advised by Revenue that the question of an individual’s entitlements in an employment context, and the question of what wages an employer may or may not be in a position to pay such an employee in light of the impact of the Covid-19 pandemic on the employer’s business, were matters that were outside the remit of the TWSS. Essentially, the scheme had no role in relation to the employer/employee relationship in so far as the terms, conditions and entitlements of the employment are concerned.

Payments made under the TWSS are income supports and share the characteristics of income. Other income earners in receipt of comparable “normal wages” are taxable on those wages. In the interest of equity, therefore, payments under the TWSS are subject to income tax and USC.

While income tax and the USC on most income is deducted in real-time as and when the person is paid, the TWSS payments were not taxed in real-time and are instead liable to income tax and USC at the end of the year (2020).

Revenue will make a Preliminary End of Year Statement available to all employees in January 2021, including those who were in receipt of the TWSS. The Preliminary End of Year Statement includes information relating to an employee’s income received, including pensions and income from the Department of Employment Affairs and Social Protection, as well as their tax credit entitlements. For the tax year 2020, the Statement will also include information on the amounts of TWSS payments, if any, received by each employee. In addition, the Statement will provide employees with a preliminary calculation of the income tax and USC position for 2020 and will indicate whether their tax position is balanced, underpaid or overpaid for the year.

Upon viewing the Preliminary End of Year Statement through myAccount, which is Revenue’s secure online facility for individual taxpayer services, employees will have an opportunity to update their personal record, declare any additional income and claim any additional tax credits due, for example, qualifying health expenses, to arrive at their final liability for 2020.

Where a liability is finalised, individuals may opt to fully or partially pay any income tax and USC liability through the Payments/Repayments facility in myAccount. Where individuals do not opt to fully or partially pay, Revenue will collect the liability by reducing their tax credits over 4 years, interest free. The reduction of tax credits will start in January 2022.

On 25 September 2020, Revenue provided an update, by way of public announcement, as to how any tax liability arising on the TWSS will be dealt with. I am pleased to welcome this fair and flexible approach being taken by Revenue and I am confident that Revenue will continue to work with their customers to minimise any financial hardship to the greatest extent possible, noting that because of our progressive income tax system, in the vast majority of cases, the expected tax liability will be modest in scale.

Joe O'Brien (Dublin Fingal, Green Party)
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404. To ask the Minister for Finance if he will be re-engaging with an organisation (details supplied) in relation to a possible further mortgage moratorium for customers. [32479/20]

Jim O'Callaghan (Dublin Bay South, Fianna Fail)
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407. To ask the Minister for Finance if he plans to bring back mortgage moratoriums for commercial and residential loans; and if he will make a statement on the matter. [32554/20]

Paschal Donohoe (Dublin Central, Fine Gael)
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I propose to take Questions Nos. 404 and 407 together.

On 18 March last, the Banking and Payments Federation of Ireland (BPFI) announced a coordinated approach by banks and other lenders to help their customers who were economically impacted by the Covid-19 crisis. The measures included flexible loan repayment arrangements where needed, including loan payment breaks initially for a period up to three months and then subsequently extended for up to six months. This was a welcome initiative and it allowed necessary relief to be quickly and efficiently provided to borrowers.

Banks have now provided for flexible options for borrowers who can recommence payments following a Covid-19 payment break, and the BPFI has produced a useful guide on this - www.bpfi.ie/wp-content/uploads/2020/09/Final-BPFI-Coming-off-the-COVID-19-Payment-Break.pdf.

However, I am very conscious that many borrowers continue to be impacted by the economic consequences of Covid-19, and that they may not be in a position to resume their loan repayment commitments when their payment break ends or may be in difficulty now for the first time. I am fully aware of the stress and uncertainty that these borrowers are facing, and they will continue to need assistance and support from their lenders. As the Deputies know, the Tánaiste, the Minister for Public Expenditure and Reform and myself met the CEOs of the country’s retail banks and the Banking Payments Federation Ireland on 28 September to discuss this matter and we indicated that it is particularly vital that lenders work with their customers to ensure that suitable arrangements are put in place to assist their customers who are still experiencing difficulty. The lenders indicated that they will ensure that customers who have difficulties in meeting their loan repayments will be supported with a range of options so that a suitable arrangement can be agreed.

Borrowers have a suite of regulatory protections, such as the Central Bank's Code of Conduct on Mortgage Arrears, and lenders have specific obligations to support and work with borrowers who are continuing to experience mortgage or other loan difficulty because of Covid-19. These options could include additional flexibility, and this could be short term such as additional periods without payments or interest-only repayments, or if appropriate more long term arrangements. The Central Bank has confirmed that there is no regulatory impediment to lenders offering payment breaks to borrowers, providing they are appropriate for the individual borrower circumstance. Each individual’s position is different and that’s why a case-by-case approach is now the best approach as some sectors of the economy are more impacted than others.

I will continue to work with the Central Bank, as regulator, to ensure that the Central Bank consumer protection framework will be fully available to mortgage and other borrowers that will still need support due to the economic impact of Covid-19.

Christopher O'Sullivan (Cork South West, Fianna Fail)
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410. To ask the Minister for Finance if the owner of a traditional funfair will qualify for the employment wage subsidy scheme or other financial support (details supplied); and if he will make a statement on the matter. [32573/20]

Paschal Donohoe (Dublin Central, Fine Gael)
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The Deputy will be aware that the Employment Wage Subsidy Scheme (EWSS) provides a flat-rate subsidy to qualifying employers based on the number of paid and eligible employees on the employer’s payroll and charges a reduced rate of employer PRSI of 0.5% on wages paid which are eligible for the subsidy payment.

I am advised that Revenue having regard to the circumstances of the person concerned and the fact that he does not have any employees on the payroll and has not had any employees on the payroll during 2020, he is not eligible for the EWSS.

That said, for those businesses who need further support the Government has made a number of other options available, such as the recently announced Covid Restrictions Support Scheme (CRSS). Particular attention is also drawn to the comprehensive package of business and employer supports that have been made available as part of the July Stimulus Plan and Budget 2021 - including the Credit Guarantee Scheme, the SBCI Working Capital Scheme, Sustaining Enterprise Fund, and the Covid-19 Business Loans Scheme.