Employers will be waiting 6 weeks for EWSS subsidies

Employers availing of the new Employee Wage Subsidy Scheme will have to wait for up to six weeks to receive payment of payroll subsidies, which they currently receive within 48 hours, the Revenue Commissioners have confirmed.

Employer bodies have warned the delays may trigger business closures and redundancies, as they will place an “unsustainable” burden on cash flow.

At present, employers availing of the Temporary Wage Subsidy Scheme receive their payroll subsidies within 48 hours of submitting payroll data to the Revenue Commissioners, who administer the TWSS.

However, from September 1, the TWSS will be replaced by the Employee Wage Subsidy Scheme.

Under the new EWSS, employers will receive a flat rate subsidy of either €151.50 or €203 per worker – down from around €350 on the TWSS.

Employees earning between €151.50 and €1,462 per week will be eligible, and employers will pay a reduced 0.5% PRSI rate.

However, in future the government subsidy will be paid up to 6 weeks in arrears, placing a new cash flow burden on businesses.

The Revenue Commissioners acknowledged that the delay could be over five weeks for those paid weekly, but said it would be as little as 2 weeks for those paid monthly.

They said the time frame for the payment of subsidies due under the EWSS is tied in with the time frame within which the relevant monthly employer PAYE return is due.

Employer group Ibec warned companies eligible for the wage subsidy scheme would already be experiencing considerable cash flow difficulties.

“A period of up to six weeks following payroll for receipt of the wage subsidy will be unsustainable for many, and Ibec will be asking the Minister to expedite this process,” it said.

Chambers Ireland also stressed that cash flow was a very significant concern.

Chief Executive Ian Talbot urged the government to find a methodology to get money to companies more quickly.

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