Pádraig O'Sullivan (Cork North Central, Fianna Fail)
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474. To ask the Minister for Finance if he will extend access to the Covid restrictions support scheme for businesses and persons that do not operate in rateable premises but still face considerable overheads as part of their operating costs, such as travel counsellors, those working in the arts and on-track bookmakers; and if he will make a statement on the matter. [18445/21]

Marc MacSharry (Sligo-Leitrim, Fianna Fail)
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493. To ask the Minister for Finance if he will review the provisions of the Covid restrictions support scheme as it applies to self-employed travel counsellors who are currently ineligible for the scheme (details supplied); and if he will make a statement on the matter. [19022/21]

Brendan Griffin (Kerry, Fine Gael)
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513. To ask the Minister for Finance if an application (details supplied) for the Covid restrictions support scheme will be reviewed; and if he will make a statement on the matter. [19714/21]

Paschal Donohoe (Dublin Central, Fine Gael)
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I propose to take Questions Nos. 474, 493 and 513 together.

The Covid Restrictions Support Scheme (CRSS) is a targeted support for businesses significantly impacted by restrictions introduced by the Government under public health regulations to combat the effects of the Covid-19 pandemic. Details of the CRSS are set out in Finance Act 2020 and detailed operational guidelines, which are based on the terms and conditions of the scheme as set out in the legislation, have been published on the Revenue website at: .

To qualify under the scheme, a business must carry on a trade or trading activities, the profits from which are chargeable to tax under Case I of Schedule D. The trade must be carried on from a business premises that is located in a region subject to restrictions introduced in line with the Government’s ‘Living with Covid-19 Plan’, with the result that the business is required to prohibit or significantly restrict customers from accessing its business premises.

To make a claim under the CRSS, a business must be able to demonstrate that, because of the Covid restrictions, the turnover of the business in the period for which the restrictions are in operation, and for which a claim is made, will be no more than 25% of an amount equal to the average weekly turnover of the business in 2019 (or average weekly turnover in 2020 in the case of a new business) multiplied by the number of weeks in the period for which a claim is made.

For the purposes of the CRSS, a business premises is defined as the building or similar fixed physical structure in which a business activity is ordinarily carried on. It does not require that the premises is a rateable premises. Mobile premises, or premises which are not permanently fixed in place, do not meet the definition of business premises.

A business that does not ordinarily operate from a fixed business premises, as in the case of an on-track bookmaker, or certain businesses in the arts sector, will not meet the eligibility criteria.

It is not sufficient that the trade of a business has been impacted because of a reduction in customer demand as a consequence of Covid-19. It is not sufficient that the business supplies goods or services to another business that is required to temporarily close, or significantly reduce, its activity as is the case with drinks wholesalers. The scheme only applies where, as a direct result of the specific terms of the Government restrictions, the business is required to either prohibit or significantly restrict access to its business premises. Each business must satisfy the eligibility criteria in their own right.

A self-employed travel agent providing services from a home office, which is not customer-facing, will not meet the eligibility criteria.

The design and operation of the CRSS is centred around the concept of the “business premises”. The CRSS is paid in respect of the period for which the business is to prohibit, or significantly restrict, members of the public from having access to the business premises in which the relevant business activity is carried on.

I understand that self-employed travel counsellors may qualify for the COVID Pandemic Unemployment Payment (PUP) payment and that such travel agents providing services from a home office, which is not customer-facing, are likely to have significantly less overheads compared to a travel agent with a customer facing business. The CRSS payment is intended to enable businesses required to close or significantly restrict access to their premises, to meet their normal fixed costs such as rent, public liability insurance, utilities and so on associated with the premises.

The vast majority of businesses in Ireland are affected by Covid but the CRSS is intended to be a targeted scheme, and was specifically designed to provide additional support to the businesses who have had to close temporarily or significantly restrict access to their premises as a direct result of public health Regulations. It was never meant to be a general support measure for the entire economy.

There are no plans to change the eligibility criteria for the CRSS. The CRSS is targeted at businesses who are forced to restrict access to their premises on foot of health regulations. It is a part of the broad spectrum of Government supports being provided to assist businesses impacted by COVID-19 which include the PUP and the Employment Wage Subsidy Scheme (EWSS). Businesses may also be eligible to warehouse VAT and PAYE (Employer) debts and also excess payments received by employers under the Temporary Wage Subsidy Scheme. The Small Business Assistance Scheme for COVID (SBASC) and Tourism Business Continuity scheme have also been established in order to support those businesses most at risk, with significant cost to the exchequer. Other schemes which have been established include the Live Performance Support Scheme (LPSS) and the Music Entertainment Business Assistance Scheme (MEBAS, both of which are targeted at supporting the commercial live performance sector.

The Government will continue to assess the effects of the Covid-19 pandemic on the economy and I will continue to work with my Ministerial colleagues to ensure that appropriate supports are in place to mitigate these effects.

Pádraig O'Sullivan (Cork North Central, Fianna Fail)
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475. To ask the Minister for Finance if he has considered reducing the tax liability of those whose income was supported by the temporary wage subsidy scheme; and if he will make a statement on the matter. [18447/21]

Paschal Donohoe (Dublin Central, Fine Gael)
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The Temporary Wage Subsidy (TWSS) was in place between 26 March and 31 August 2020 and was introduced as an emergency income support for employees of vulnerable firms whose businesses had been negatively impacted by COVID restrictions and whose turnover had reduced by at least 25% during Q2 while the strictest public health measures were in place. The support was paid via the employer so as to maintain employment links between the employee and employer insofar as was possible and, to that end, the rate of Employers' PRSI was also significantly reduced to 0.5%. The level of income given to each individual employee was based on previous wages received in January and February 2020. Over 66,500 employers received a subsidy under the TWSS with payments worth just under €2.9 billion paid out to a total of 664,000 workers.

The subsidy was based on net pay and tax was not collected in real-time through the PAYE system while the scheme was in operation, and instead would be collected after an end of year review, if any such liability arose. This decision was taken in order to maximise the amount of financial support that was provided to recipients at a time when it was considered that they needed such support most, when the TWSS was first announced and expected to only be in place for 12 weeks.

Net pay was the chosen benchmark for the TWSS as the priority was to preserve take-home income of workers insofar as was possible, noting that similar rates of income supports based on previous pay levels were also being provided for those on the Pandemic Unemployment Payment (PUP) administered by the Department of Social Protection.

When the TWSS was extended for a further 10 weeks until the end of August 2020, Revenue took steps to minimise the amount of income tax and USC due, if any, on TWSS payments at the end of the year. This was done by placing all recipients of the TWSS or PUP on the ‘week 1 basis’ of taxation for the remainder of the year so as to “preserve” unused tax credits that can then be used to offset any income tax or USC liabilities that arise at year end.

The Government has been consistent as regards the TWSS’s liability to tax from the outset of the payment and, in my view, having regard to considerations of equitable treatment of taxpayers, a case for any action along the lines mentioned by the Deputy does not arise.

Payments made under the TWSS were regarded as income supports and share the characteristics of income. Other income earners in receipt of comparable “normal wages” are taxable on those wages. In equity, therefore, payments under the TWSS are subject to income tax and Universal Social Charge (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 were instead liable to income tax and USC at the end of 2020.

I have been advised by Revenue that it clarified the tax treatment of the TWSS at employee level in the guidance material on the TWSS that it has published on its website since the commencement of the Scheme. Furthermore, Revenue actively engaged in facilitating webinars with the Employer Bodies, Accountancy Firms and Tax Practitioners to explain and clarify any issues for employers as regards the TWSS. For the information of the Deputy, Revenue’s material on Frequently Asked Questions on the TWSS can be found at:

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Although the final calculation of the end of year liability for each person is dependent on their personal circumstances based on data that Revenue released in January, it is noted that almost half of those in receipt of the PUP or TWSS have no outstanding liability to discharge (in fact over a third are due a refund).

In the case of the remaining taxpayer units with an outstanding liability, the data indicates that amounts to be collected are modest in scale, with 44% owing less than €500 and 72% having a liability of less than €1,000. If paid over the 4 year period beginning in 2022, the majority of those cases will owe less than €5 per week, with nearly half paying less than €2.50 per week. These figures represent a preliminary liability and may be further reduced by additional tax credits or reliefs such as health expenses.

Revenue has also given assurances that if any income tax and USC liabilities remain following the allocation of unused credits, it will work with its customers to collect the outstanding liabilities and a number of flexible arrangements may be entered into, including the collection without interest over an extended period of time for 4 years beginning in 2022.It is also understood that Revenue are facilitating employers who wish to pay the tax liabilities of their employees where such income tax and USC liabilities arise from the scheme.

Revenue made a Preliminary End of Year Statement available to all employees from 15 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 Social Protection, as well as their tax credit entitlements. For the tax year 2020, the Statement also includes information on the amounts of TWSS payments, if any, received by each employee. In addition, the Statement provides employees with a preliminary calculation of the income tax and USC position for 2020 and indicates 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 have an opportunity to complete their income tax return for 2020, declaring any additional income and claiming any additional tax credits due, for example qualifying health expenses, to arrive at their final liability for 2020.

When 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.

The Preliminary End of Year Statement sets out a provisional tax position for 2020, based on information available on Revenue records, including any Temporary Wage Subsidy Scheme (TWSS) payments reported by the individual’s employer. Revenue published provisional statistics in relation to the preliminary end of year tax position for all PAYE taxpayers for the year 2020, on 14 January 2021 which is available to view on Revenue’s website:

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I might conclude by noting that Revenue are facilitating employers who wish to pay the tax liabilities of their employees where such income tax and USC liabilities arise from the scheme. Any employers who are in a position to discharge such liabilities on behalf of their workers are encouraged to do so, but it is also acknowledged that, as with the decision around whether to avail of the TWSS in the first place, the question of whether an employer pays the income tax owed by employees in respect of the TWSS is a matter between the employer and the relevant employees.