Employment Wage Subsidy Scheme (EWSS)

  • Written By: Aileen Dunning
  • Published: Tue, 18 Aug 2020 16:30 GMT

The government announced a new Employment Wage Subsidy Scheme (EWSS) as part of the July Stimulus package released on 23 July. It will replace the existing Temporary Wage Subsidy Scheme (TWSS) with effect from 1 September 2020 and will run until 31 March 2021, which will provide many employers with an important financial lifeline.

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The two schemes will run concurrently from 1 July until 31 August when the TWSS will cease. Note while the schemes are running concurrently an employer cannot receive EWSS support in respect of an employee where TWSS is already being claimed during this period. However, the EWSS scheme can be claimed for new hires and seasonal workers who were not previously eligible to be paid via TWSS therefore providing additional flexibility to employers.

Revenue issued guidelines for the operation of the EWSS scheme on 14 August 2020. A separate registration process needs to be followed for EWSS than that of the TWSS as the eligibility criteria differs – eligible employers will be able to register for EWSS through ROS from 18 August 2020. Revenue have clarified that claims for new hires and seasonal employees can be backdated to 1 July 2020. Payments for July and August are expected to be made by Revenue in mid-September.

The subsidy paid under the new EWSS is an employment support payment to qualifying employers based on the number of paid and eligible employees on the employer’s payroll as opposed to the existing TWSS which is considered a payment to the employee (albeit it is administered by the employer). Under the EWSS, the employer will pay the employee their normal wages and will then receive a subsidy from the Revenue in respect of each eligible employee.

On 24 July the Financial Provisions (COVID-19) (No.2) Bill 2020 was published, it provides the legislative footing for this new wage support scheme and sets out various particulars of the scheme, which are considered in detail below, including:

  1. the employer and employee eligibility criteria;
  2. the rates of subsidy payable;
  3. other administrative and operational aspects; and
  4. action to be taken by employers.

1. The employer and employee eligibility criteria

Employer Eligibility

To be eligible to participate in the EWSS, the employer must be able to demonstrate to the satisfaction of the Revenue that, they their business have been significantly disrupted by reason of COVID-19. Specifically, the employer needs to be able to demonstrate that:

  • their business will experience a 30% reduction in turnover or customer orders between 1 July and 31 December 2020, and
  • that this disruption is caused by COVID-19.

The comparative period for the demonstration of this reduction in turnover or customer orders is:

  • the same period in 2019 where the business was in existence prior to 1 July 2019,
  • the date of commencement to 31 December 2019, or
  • where a business commenced after 1 November 2019, the projected turnover or orders.

For employers to remain eligible for the EWSS for the entire period they must:

  1. Be entitled to a tax clearance, meaning the employer must have complied with their obligations under tax legislation in relation to filing returns and paying taxes, and
  2. Undertake a review on the last day of every month to ensure they continue to meet the above eligibility criteria. If they no longer qualify, they should deregister for EWSS with effect from the following day (that being the first of the month).

The scheme will be administered by Revenue on a 'self-assessment' basis. The EWSS will re-establish the normal requirement to operate PAYE on all payments. This includes the regular deduction and remittance of income tax, USC and employee PRSI. Employer PRSI at the reduced rate of 0.5% will apply for employments that are eligible for the subsidy.

Employee Eligibility

  • Any employee who was considered an eligible employee under the existing TWSS provisions will also be considered an eligible employee for the EWSS. When TWSS ceases to be claimed for an employee (latest 31 August) an EWSS claim can commence.
  • Any employee who during the period from 1 July 2020 to 31 March 2021 is in receipt of emoluments from the employer – seasonal and new hires are included.
  • The initial drafting of the bill excluded an individual who is a proprietary director of a company. However, following a government announcement on 31 July, it appears that proprietary directors who meet the objective of the scheme of retaining ordinary employees on payroll will also be eligible with effect from 1 September, additional guidance will be provided in due course.
  • Excluded from the scheme are employees who are connected (e.g. spouse, sibling, child) with the employer unless such employees were on the payroll of that employer and received a payment, during the period from 1 July 2019 to 30 June 2020.


2. Rates of subsidy payable

Under the EWSS, eligible employers will receive a per-head subsidy on a flat rate basis which will be determined based on the amount of gross pay that the employer pays to the eligible employee as follows:

The rates payable under the EWSS have been simplified considerably compared to the rates payable currently under the TWSS. Under the existing TWSS, those employees with gross pay in excess of €960 per week are not eligible for the subsidy. This upper gross pay limit has been increased to €1,462 under the new scheme. However, a lower gross pay limit of €151.50 is now provided for which doesn’t exist under the TWSS.


3. Administrative and operational aspects

A. Registration for the EWSS

The employer will be required to register for the EWSS via the Revenue website and declare their eligibility to partake in the scheme.

B. From 31 July

Assuming employers meet the qualifying criteria, the EWSS will be available from 31 July for:

  • TWSS employers who have non-TWSS employees (new hires), and
  • Non TWSS employers, who have not previously availed of the TWSS,
  • TWSS employers will still be able to rehire eligible employees and continue to operate TWSS to 31 August 2020.

C. Anti-avoidance

There are specific anti-avoidance provisions included in the bill to prevent employers entering:

  1. contrived situations whereby any gross pay due to an employee is deferred, suspended, increased or decreased with a view to securing the wage subsidy, or
  2. situations where an employee is laid off and removed from the payroll and replaced with two or more employees each of whom work less hours than the first-mentioned employee, with a view to securing an increase in the number of qualifying employees in relation to whom a wage subsidy payment is payable from Revenue

If Revenue identify any such cases, the employer will be treated as having never been eligible for the scheme and any subsidy payments received would need to be refunded, together with possible interest and penalties.

D. Publication

The names and addresses of all employers who receive a wage subsidy payment under the new EWSS will be published on

4. Action to be taken by employers

i. Review the eligibility to partake in the EWSS scheme

ii. Register via ROS for EWSS – Where an employer files an EWSS payment submission without first registering for EWSS, it will be rejected in full. As registration cannot be backdated, its imperative registration is undertaken prior to the first pay date in respect of which EWSS is being claimed.

iii. Ensure the employer holds a valid tax clearance certificate - Employers must possess a valid tax clearance certificate to enter the EWSS and continue to maintain tax clearance for the duration of the scheme. Employers can check their current tax clearance status through ROS. If an employer does not currently hold tax clearance, an application can be made online and assessed in real-time through the ROS e-Tax clearance service.

iv. Implement continued review of employer eligibility process - Employers are required to undertake a review on the last day of every month (other than July 2020 and the final month of the scheme) to ensure they continue to meet the above eligibility criteria. If employers no longer qualify, they must deregister for EWSS through ROS with effect from the following day (that being the 1st of the month) and cease claiming the subsidy.


Details sourced from and correct as at 18th August 2020:


We have taken great care to ensure the accuracy of this publication. However, the publication is written in general terms and you are strongly recommended to seek specific advice before taking any action on the information it contains.
Smith & Williamson Freaney Limited Authorised to carry on investment business by the Institute of Chartered Accountants in Ireland. A member of Nexia International.

Tax legislation is that prevailing at the time, is subject to change without notice and depends on individual circumstances. Clients should always seek appropriate tax advice before making decisions. HMRC Tax Year 2022/23.


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