Employment Wage Subsidy Scheme (EWSS) Overview

Revenue have recently released additional guidance on the Employment Wage Subsidy Scheme (EWSS) which will replace the Temporary Wage Subsidy Scheme (TWSS) from 1 September 2020. Additionally, eligible employers can backdate a claim to the 1 July 2020 for EWSS payments for new hires and seasonal workers.  

EWSS has two elements as follows:

  • It provides a flat-rate subsidy based on an employee’s gross pay in that pay period and 
  • It charges a reduced rate of employers PRSI of 0.5% on wages which are eligible for the subsidy payment.

Employer Eligibility Criteria 

Employers must possess a valid tax clearance certificate to enter the EWSS and continue to maintain tax clearance for the duration of the scheme.  Businesses with COVID 19 related tax debts which have been warehoused, or non- COVID debts which are included in a phased payment arrangement can still qualify for tax clearance despite these debts.

 In addition to having tax clearance the employer must be able to demonstrate that their business is expected to experience a 30% reduction in turnover or orders between 1 July and 31 December 2020 looking at the period as a whole rather than on a monthly basis  and that this disruption is caused by COVID 19. The reduction in turnover or orders is relative to the same period in 2019 where the business existed prior to 1 July 2019.

Where the business commenced trading between 1 July and 31 October 2019, the 30% decline test in 2020 must be determined by reference to the operating period in 2019.

Where a business commenced on or after 1 November 2019, the employer must show that the turnover or orders will be at least 30% less than projected turnover or orders between July and December 2020.

Childcare businesses registered in accordance with Section 58C of the Childcare Act 1991 are also included in the scheme with no turnover test to be met.

Monthly Review of Continued Eligibility for Scheme 

Businesses are required to undertake a review on the final day of every month to ensure they continue to meet the eligibility criteria described above.  If a business no longer qualifies they must deregister for EWSS and ceases claiming the subsidy with effect from the first day of the following month.

Where the employer becomes eligible once more in subsequent months, they can re-register and claim from the date of re-registration.  A claim cannot be back-dated for a period of de-registration

Employee Eligibility

An employee who receives a payment at anytime between 1 July 2020 and 31 March 2021 subject to certain exclusions outlined below is as an eligible employee. The extension of the EWSS to seasonal workers and new hires is to be welcomed.


  • Proprietary Directors; the initial drafting of the Bill excluded proprietary directors. However, this is now under review by the Minister of Finance and proprietary directors may be included where the company has other eligible employees. Further guidance is expected on this issue.
  • Connected Persons; Revenue have confirmed that an individual connected with the employer is excluded from EWSS unless this person received pay from the employer between 1 July 2019 and 30 June 2020.
  • Employees employed otherwise than as part of the business; e.g. domestic employees such as childminders, gardeners.

EWSS can only be claimed in respect of payroll submissions of not more than a monthly pay frequency i.e. quarterly/yearly/bi-yearly claims will not be processed. 

Operational aspects of the EWSS

Registration for the EWSS

The employer will be required to register for the EWSS on ROS.  As part of the registration process the employer will be required to declare that the eligibility criteria are met.  The date of registration cannot be backdated prior to the date of application.  For claims in respect of payments in July/ August there is no requirement to backdate a claim.

Claiming the EWSS

Under the new scheme, the employer will pay the employee their normal wages and will then receive a subsidy from the Revenue in respect of each eligible employee following submission of the payroll return based on the rates set out in the below table. 

EWSS Rates

The rate of weekly subsidy the employer will receive per eligible employee is as follows:

Tax Treatment and PRSI

Revenue have confirmed that all gross payments made to employees under the EWSS should be liable to PAYE, USC and PRSI in the normal way.   However, while employers PRSI will be included at the normal rate in the payroll submission, a reduced rate of 0.5% will apply to employments that are eligible for the subsidy and Revenue will make an adjustment to the liability returned in the payroll submission to reduce the amount payable for the month.

Anti Avoidance

Certain anti-avoidance provision are included in the legislation which seek to counteract:

Situations where an employer lays off one employee and replaces him with two or more employees to claim more subsidies

Contrived situations whereby any gross pay due to an employee is deferred, suspended, increased or decreased with a view to obtaining a wage subsidy (or higher subsidy) from Revenue


As with the TWSS, a list of employers availing of the EWSS will be published on Revenue’s website in January 2021 and April 2021.