The COVID-19 Employer Refund Scheme was replaced by the Temporary COVID-19 Wage Subsidy Scheme, effective 26 March 2020. The COVID-19 Employer Refund Scheme was applicable from the 15th to the 25th March 2020.
The system item is available for those employers who paid employees under this Refund scheme but did not finalise payslips and submit the information to Revenue.
NB! Please only use this system item if you made an actual payment to employees during the 15-25 March period. If the payment was made after the 25th March, you must use the Temporary COVID-19 Wage Subsidy Scheme system item. NB!
Revenue’s COVID Employer Refund scheme on behalf of DEASP is aimed to relieve hardship on employees that have been laid off as a result of the COVID-19 (Coronavirus) pandemic. This scheme also serves to allow the relationship between employers and their employees to continue. Employers can apply to operate under the Employer COVID-19 Refund Scheme by applying on ROS under myEnquiries. The steps to apply can be found here.
Under this scheme, employers are able to pay a weekly special support payment of €203 to their existing employee(s) that have been temporarily laid off as a result of COVID-19. Employers will be refunded this pay, plus the amount of any tax and USC refunded to each employee, the day after the payroll submission is made to Revenue.
SimplePay has a built-in item to accommodate the special payment and submission requirements for employees that have been temporarily laid off as a result of COVID-19.
Adding the COVID-19 Employer Refund Scheme Item
The COVID-19 Employer Refund Scheme item can be added on SimplePay as follows:
- Go to Employees
- Select an employee
- Select Add next to Payslip Inputs
- Select the COVID-19 Employer Refund Scheme item
- Enter the corresponding amount based on the employee’s pay frequency
Employees who have been temporarily laid off can be paid €203 per week under this scheme. Therefore employers must input the correct amount based on the employee’s pay frequency:
- Weekly – €203
- Every 2 weeks – €406
- Monthly – €812 (for 4 weeks in a month) or €1015 (for 5 weeks in a month)
This amount is not subject to tax, USC or PRSI.
Employees under this scheme must not receive any other wage payments from their employer, including wage top ups, overtime, shift allowance and on-call payments. As such, you will need to set the Basic Salary to 0 and remove any other Payslip Items and Regular Items on the payslip before finalising.
PRSI Class J9 and Refunds to Employers
Revenue requires that the payroll submission contains a PRSI class of J9. This PRSI class lets Revenue know that the employee has been paid under the COVID-19 Employer Refund Scheme. Revenue will refund the employer the day after the payroll submission is made.
Note: You do not need to make any changes to the employee’s PRSI class or PRSI exemption status, this is done automatically when the COVID-19 Employer Refund Scheme item is added.
Employees Laid-Off During a Period
Employees that are paid monthly or fortnightly, and have been laid-off part way through their pay period, will need to have their pay frequency changed to weekly. You should not finalise the monthly payslip, but should first switch employees to a weekly pay frequency, allowing for the worked weeks to be separated from payments under the COVID-19 Employer Refund Scheme. The worked weeks should have the monthly pay pro-rated accordingly. This is in line with Revenue’s recommendations in their guide for the Operation of the COVID-19 Employer Refund Scheme, which can be viewed here.
Application of Revenue’s Recommended €0.01 Pay Amount
Although Revenue recommends that a pay amount of €0.01 is required in order for payroll to run, this is not the case when using SimplePay. No amount is needed under Basic Salary for you to run your payroll, meaning the payslips’ basic salary will read zero. Revenue has communicated directly with SimplePay to confirm that the €0.01 is not required and employers will still receive a refund when submitting €0.00.
Employers should keep employees on their payroll and should not end their service.
If an employee has been terminated and submitted to Revenue already, your employee will need to apply directly to the the DEASP. Revenue will not be refunding employers if they have previously made a payroll submission with the employee’s cessation date.
Employees that qualify for qualified adult or qualified dependent payments, should claim directly from the DEASP.
Please refer to the Revenue guide for the Operation of the COVID-19 Employer Refund Scheme for more information.