Wage Subsidy Scheme Issues

Heres Johnny

Seve OB wrote: »

Fair enough but just remember in future you should stick to the rpn’s unless Specifically told to change them by revenue.

What about the staff you have working full hours though and possibly those on 3 or 4 days a week. You are cutting their pay when you shouldn’t be.

Staff on full hours will still be paid fully. Staff on no hours will still get 75% of pay which is the least we plan on paying anybody. Those on part time will be paid somewhere in between, nobody is getting a pay cut based on hours paid at all.

Seve OB

Heres Johnny wrote: »

Staff on full hours will still be paid fully. Staff on no hours will still get 75% of pay which is the least we plan on paying anybody. Those on part time will be paid somewhere in between, nobody is getting a pay cut based on hours paid at all.

Fair enough I thought it seemed like you were claiming the subsidy for the guys still on full time

Seve OB

kennethsmyth wrote: »

This is incorrect - you are mixing up what the company will be subsidized and what they will pay you. The SUBSIDY will drop to 350 after 586 and over 960 no subsidy to the company. However if the company is paying all other staff 70% to a max of 410 then they also need to do that a minimum for you otherwise it would be discrimination. Its not worth the company only paying you 350 if your normal net is much more as otherwise why would you continue to do any work at all if the covid payment from social is also 350 for 12 weeks

Sorry but I don’t see where anything I said was incorrect.

noodler

I've a family member going on this scheme (reduced hours).

I've told them to keep 25% of the 410 for the taxman.

Heres Johnny

Seve OB wrote: »

Fair enough I thought it seemed like you were claiming the subsidy for the guys still on full time

I am claiming subsidy for people still on full time. And topping them up to 100%.
Nothing wrong with that is there? Sales revenue will be down about 60-70% at an estimate.

Seve OB

Heres Johnny wrote: »

I am claiming subsidy for people still on full time. And topping them up to 100%.
Nothing wrong with that is there? Sales revenue will be down about 60-70% at an estimate.

you'd need to spell it out a bit more
when you say that you are topping it up to 100%, what do you mean, is it 100% of their average net? if thats all it is, and unless the employee doesn't pay a penny in tax, then it will actually mean a pay cut to them.
if you top up to 100% of their normal gross, then the subsidy will be cut.

bigboss1986

Seve OB wrote: »

You are now on the new scheme. It should be 70% of your usual net pay as calculated by the formula.
You cannot claim any other relief

Thanks.Just closed my claim online on welfare.ie site.


Im still confused about my payslip.My average net is 565 and my payslip says:
Covid19 +343,Tax refund -47 and USC refund -18,Wages 0.01c(1 cent).
Should I be getting more?

Seve OB

bigboss1986 wrote: »

Thanks.Just closed my claim online on welfare.ie site.


Im still confused about my payslip.My average net is 565 and my payslip says:
Covid19 +343,Tax refund -47 and USC refund -18,Wages 0.01c(1 cent).
Should I be getting more?

Yes. 70% of 565 is 395.5.
So unless you are not calculating the average net correctly, the 343 is to low.

Average net = gross less tax & PRSI. If you have any other deductions they don’t count. It’s possible your employer calculated your avg net wrong

booooonzo

Our company of 80 has said 20% cuts across the board for all over 30k and they will be availing of the scheme.
All working from home and never busier tbh.
We have to sign a form to agree to pay cuts until October.
I don't believe they don't have funds to pay us as we were apparently doing very well the last year or 2

Does it seem like a correct application of the scheme
Will we be liable to tax at year end or is that person basis
Should we be looking to do 4 day week with the 20% cuts
Is one of the criteria for the scheme the employer must not lay anyone off?

Thanks

mickdw

booooonzo wrote: »

Our company of 80 has said 20% cuts across the board for all over 30k and they will be availing of the scheme.
All working from home and never busier tbh.
We have to sign a form to agree to pay cuts until October.
I don't believe they don't have funds to pay us as we were apparently doing very well the last year or 2

Does it seem like a correct application of the scheme
Will we be liable to tax at year end or is that person basis
Should we be looking to do 4 day week with the 20% cuts
Is one of the criteria for the scheme the employer must not lay anyone off?

Thanks

Thats a disgrace regardless of whether the scheme allows it or not. All as busy as ever and company only wants to pay 10 percent of wages

Seve OB

booooonzo wrote: »

Our company of 80 has said 20% cuts across the board for all over 30k and they will be availing of the scheme.
All working from home and never busier tbh.
We have to sign a form to agree to pay cuts until October.
I don't believe they don't have funds to pay us as we were apparently doing very well the last year or 2

Does it seem like a correct application of the scheme
Will we be liable to tax at year end or is that person basis
Should we be looking to do 4 day week with the 20% cuts
Is one of the criteria for the scheme the employer must not lay anyone off?

Thanks

personally i wouldn't sign anything
i would question them and ask why are they going on the scheme and tell them that you don't believe they should be as it is meant for companies who are struggling and should be implemented to keep staff on the books rather than sending them to the live register. it is for reduced hours, not keeping somebody working full time.

but fact they have been doing well and if they have millions in the bank, none of that matters, it is how they are performing now that counts.

sales would have to be down at least 25% and they need to prove it or they will be in trouble for claiming the subsidy.
if sales are down, then they shouldn't need all the staff to remain full time

mickdw wrote: »

Thats a disgrace regardless of whether the scheme allows it or not. All as busy as ever and company only wants to pay 10 percent of wages

na. if you take them literally a 20% of lets say 50k is 10k. so ee is down to 40k.
max the subsidy will be is 18k so they would still be paying nearly 50% of the wages
i any case the subsidy would then reduce because they can't actually claim that much on the scheme so they will pay a higher percentage

i actually don't think these companies know what they are doing at all.

booooonzo

The performing poorly thing they could probably "prove" as for Q2 a lot of our income will more than likely be delayed until Q3/4
I see on revenue you can also prove decline by showing you had to do paycuts.
This is what p*sses me off the most and seems like the are basically trying to profit or at least not dig in to any cash that they have.

Why do you say 18k? I seen above that if any of the employees get the 410 subsidy, which some of our lower paid employees would, then all employees would get the 410? any truth in that?

blackwhite

Seve OB wrote: »

personally i wouldn't sign anything
i would question them and ask why are they going on the scheme and tell them that you don't believe they should be as it is meant for companies who are struggling and should be implemented to keep staff on the books rather than sending them to the live register. it is for reduced hours, not keeping somebody working full time.

but fact they have been doing well and if they have millions in the bank, none of that matters, it is how they are performing now that counts.

sales would have to be down at least 25% and they need to prove it or they will be in trouble for claiming the subsidy.
if sales are down, then they shouldn't need all the staff to remain full time



na. if you take them literally a 20% of lets say 50k is 10k. so ee is down to 40k.
max the subsidy will be is 18k so they would still be paying nearly 50% of the wages
i any case the subsidy would then reduce because they can't actually claim that much on the scheme so they will pay a higher percentage

i actually don't think these companies know what they are doing at all.

That part is not accurate - and Revenue have confirmed this in discussions with all of the large professional firms, and indeed in the guidance document:

Eligible employers can participate in the scheme in respect of any eligible employees on their payroll, including those on fulltime, reduced hours, rehired staff who were temporarily laid off, or staff temporarily laid off but retained on the payroll.

The scheme is equally open to companies who have everyone remaining working full time, but Revenue have an expectation that those companies should be making effort to top up pay to as close to normal average as possible.

There's plenty of valid reasons why a business will need to keep 100% of their staff on full hours, despite turnover or order levels having dropped by 25% or more.

Dav010

Seve OB wrote: »

personally i wouldn't sign anything
i would question them and ask why are they going on the scheme and tell them that you don't believe they should be as it is meant for companies who are struggling and should be implemented to keep staff on the books rather than sending them to the live register. it is for reduced hours, not keeping somebody working full time.

i actually don't think these companies know what they are doing at all.

And you were doing so well.

As the poster above stated, this scheme is open to any business whose income have dropped by 25%. The scheme is precisely to help companies retain staff, that posters company is doing nothing untoward by availing of the subsidy.

A company doesn’t have to be “struggling”, theIt business has to be effected by Covid 19 by 25%.

Advising someone to accuse their employer of lying and defrauding Revenue isn’t the smartest, there is nothing to stop the company laying off that poster.

bigboss1986

Seve OB wrote: »

Yes. 70% of 565 is 395.5.
So unless you are not calculating the average net correctly, the 343 is to low.

Average net = gross less tax & PRSI. If you have any other deductions they don’t count. It’s possible your employer calculated your avg net wrong

You were right.My average net is 490.Sent email to my employer about top up amd she said I will get to top if it needs to be.Not sure why I did get 1c this week

tucker1971

I do payroll for an employer who will always pay his staff an agreed net wage irrespective of their credits, ie, he takes the hit for the tax.

So example one, he has an employee on €400 net, gets a subsidy of €280, gets tax back of €62, and makes up the balance of €58, so the employee still comes out with their weekly net pay. My question is should he have to pay that tax back of €58 as extra, so that the employees new net will now be €458, bearing in mind that the employer has always paid the tax?

Secondly I noted that the subsidy amount can be manually reduced in order to reconcile the wage?

Can anyone help with this?

gb19815

Hi can anyone confirm in relation to taxes repaying ? I received about 100 back in paye and paid about 800 this year , does this mean it will repay at that rate for next few weeks ?

Tow

bigboss1986 wrote: »

You were right.My average net is 490.Sent email to my employer about top up amd she said I will get to top if it needs to be.Not sure why I did get 1c this week

The one cent is to trigger Submission to ROS from the Payroll, if just the Subsidy is being paid. It is not required by all payroll software, but is in Revenues instructions to reduce confusion.

Dav010

tucker1971 wrote: »

I do payroll for an employer who will always pay his staff an agreed net wage irrespective of their credits, ie, he takes the hit for the tax.

So example one, he has an employee on €400 net, gets a subsidy of €280, gets tax back of €62, and makes up the balance of €58, so the employee still comes out with their weekly net pay. My question is should he have to pay that tax back of €58 as extra, so that the employees new net will now be €458, bearing in mind that the employer has always paid the tax?

Secondly I noted that the subsidy amount can be manually reduced in order to reconcile the wage?

Can anyone help with this?

Interesting way of paying staff, what does your employer do if an employee transferred tax credits to spouse?

michellie

Work are paying us the 70% I only work 3 days a week, I got a payment of €504 yesterday (fortnight wage) plus tax back of €126. But I'm assuming now the €504 is the basic Covid 70% pay I will be getting and from next fortnight I won't have any more tax back.

I would be better off I was claiming the government €350per week at least then it would be the same as my regular wages. Is there no way I can do this or am I stuck with my 70%?

Stratvs

gb19815 wrote: »

Hi can anyone confirm in relation to taxes repaying ? I received about 100 back in paye and paid about 800 this year , does this mean it will repay at that rate for next few weeks ?

You may receive refund of PAYE & USC for some weeks as your current taxable gross is small in relation to what it was before. However the non-taxed subsidy is taxable ( just not through payroll ) and reviews will be done later to reconcile what was paid and what should have been paid. Revenue have said in their FAQ to the scheme ( See 3.11 at linke below) that they will deal with that over time in manageable amounts. The aim right now is to give people money in their pocket when they need it.

https://www.revenue.ie/en/employing-people/documents/pmod-topics/guidance-on-operation-of-temporary-covid-wage-subsidy-scheme.pdf

tucker1971

Dav010 wrote: »

Interesting way of paying staff, what does your employer do if an employee transferred tax credits to spouse?

He gets screwed sometimes but generally gets the employee to divide the credits between spouses.

Radharc na Sleibhte

Hi,
Doing the wages for my small business including my son on payroll. We are topping up the full 30%. Should I click the box to disallow paye refunds? Both my staff and I will only end up paying it back won’t we and they’re all getting they’re full wage as is? I’m not sure?

Stratvs

Radharc na Sleibhte wrote: »

Hi,
Doing the wages for my small business including my son on payroll. We are topping up the full 30%. Should I click the box to disallow paye refunds? Both my staff and I will only end up paying it back won’t we and they’re all getting they’re full wage as is? I’m not sure?

I have been told that you should not mess with the RPN currently in force. Apart from anything else it may cause issues between the payroll and ROS when filing.

I know it makes more sense to do what you suggest and new RPNs on W1 basis might be a better idea to avoid underpayments later. But from webinars I've had they've all said give the refund. It's also in the FAQ (currently V5.0) at 4.1.

https://www.revenue.ie/en/employing-people/documents/pmod-topics/guidance-on-operation-of-temporary-covid-wage-subsidy-scheme.pdf

Stratvs

tucker1971 wrote: »

I do payroll for an employer who will always pay his staff an agreed net wage irrespective of their credits, ie, he takes the hit for the tax.

So example one, he has an employee on €400 net, gets a subsidy of €280, gets tax back of €62, and makes up the balance of €58, so the employee still comes out with their weekly net pay. My question is should he have to pay that tax back of €58 as extra, so that the employees new net will now be €458, bearing in mind that the employer has always paid the tax?

Secondly I noted that the subsidy amount can be manually reduced in order to reconcile the wage?

Can anyone help with this?

The EE is supposed to get any PAYE/USC refund due to them.

See 4.12 in the FAQ
https://www.revenue.ie/en/employing-people/documents/pmod-topics/guidance-on-operation-of-temporary-covid-wage-subsidy-scheme.pdf

Where an employee is due a refund of Income Tax or USC based on the payroll being processed, this should be paid
by the employer and Revenue will refund this to the employer along with the associated wage subsidy.
This refund of Income tax and USC is made to the employee, in addition to the subsidy payment and any additional
payment, and should not be included in the employer’s calculation of the allowable additional payment.

PS perhaps this is a good time to get the ER away from paying on a net basis. It causes so much trouble.

Dav010

tucker1971 wrote: »

He gets screwed sometimes but generally gets the employee to divide the credits between spouses.

So he doesn’t pay net amount in all circumstances?

Given that a tax hike is inevitable, it would be extraordinary for an employer to guarantee a net figure.

Stratvs

Dav010 wrote: »

So he doesn’t pay net amount in all circumstances?

Given that a tax hike is inevitable, it would be extraordinary for an employer to guarantee a net figure.

Paying net is crazy. However was very common. Less so now I believe as the commencement of PMOD from 01/01/19 was opportunity to clean a lot of that up. However all it takes is a couple to TX most Crs and cut-off to other spouse and you've a big problem.

Seve OB

Dav010 wrote: »

And you were doing so well.

As the poster above stated, this scheme is open to any business whose income have dropped by 25%. The scheme is precisely to help companies retain staff, that posters company is doing nothing untoward by availing of the subsidy.

A company doesn’t have to be “struggling”, theIt business has to be effected by Covid 19 by 25%.

Advising someone to accuse their employer of lying and defrauding Revenue isn’t the smartest, there is nothing to stop the company laying off that poster.

Fair call. It was late!
I don’t think I was advising anyone though to accuse their employer of lying and defrauding though. I was more saying the employee should discuss with their employer. And if an employer makes a false declaration they can find themselves in a sticky situation.

In the spirit of the scheme though, it should not be abused to get subsidies and keep staff on full hours. As above in bold, this is what I was trying to say.

I’ll show so examples later on of what I mean about pay cuts.

I’ll need to remedy myself so that I can ask some questions....... and I have a couple on the back burner!

Dav010

Seve OB wrote: »

Fair call. It was late!
I don’t think I was advising anyone though to accuse their employer of lying and defrauding though. I was more saying the employee should discuss with their employer. And if an employer makes a false declaration they can find themselves in a sticky situation.

In the spirit of the scheme though, it should not be abused to get subsidies and keep staff on full hours. As above in bold, this is what I was trying to say.

I’ll show so examples later on of what I mean about pay cuts.

I’ll need to remedy myself so that I can ask some questions....... and I have a couple on the back burner!

The subsidy is precisely for what the posters employer is using it for, to keep people in employment even though business is down by 25%. I could see your point if the employer is keeping the employee on full hours, and not topping up, but topping up while on full hours is how the subsidy is supposed to work. Any business which suffered an overnight reduction of +25% would be looking at cutting costs, the quickest way of doing that is to cut labour costs by laying staff off.

I really don’t get why you think it is against the “spirit of the scheme” for employers to avail of this if they can show Revenue a 25% drop in income.

Why do you think a false declaration is being made in this case? On the balance of probability, the weight is heavily on that drop being genuine given current circumstances. And why would you think an employee would be entitled to a response from an employer about proof of income drop?

lord quackinton

My employer looked at this and refused to sign up for three reasons
1. Name is published by revenue
2. A drop in 25% in revenue is something they believe that must be proven in time , revenue are playing the nice guy but in time will review every application
3. The employees Will be reviewed by revenue at year end. This will be very messy

We will be paid as long as we can and then go on the 350 payment or stamps