Covid-19 : Support for businesses and the self-employed

Updated: Mar 30

A concise guide to the reliefs available to businesses and the self-employed as a result of the Covid-19 Pandemic.

Topics Discussed


1. Introduction

2. COVID-19: Temporary Wage Subsidy Scheme

3. COVID-19 Pandemic Unemployment Payment ( Employees & Self-Employed)

4. COVID-19 Microfinance Business Loans (Sole Traders & LTD Companies)

5. COVID-19 Credit Guarantee Scheme

6. Upcoming Revenue Payments

7. Upcoming CRO Returns (Annual Return)

8. The Local Enterprise Office Business Continuity Voucher



Introduction

The Corona Virus Pandemic is having a wide-reaching consequence from both a global and a national perspective. It is having the greatest impact on our community from a health perspective, something that the majority of us have not seen in our lifetime. We all hope this passes with as minimal loss to life as possible.


The economic impact of the virus is also significant and should not be underestimated. Companies, sole-traders and employees currently find themselves living in uncertain times with their income under threat. The Government and related agencies have responded with several initiatives aimed at supporting both employees and employers.


We have put together a concise summary of available reliefs available to the self-employed and business community. If you need any assistance or further detail on the below schemes, please get in touch. We want to support the business community in Ireland and would be delighted to help you through these difficult times.

COVID-19: Temporary Wage Subsidy Scheme

What is it?


The scheme aims to facilitate an employer wanting to keep an employee on the payroll and retain them until business picks up.


The scheme enables employees, whose employers are affected by the pandemic, to receive significant supports directly from their employer.


A subsidy of the lower of €410 or 70% of an employee’s average net weekly wage is available for employees earning less than €587 per week.


An employer may choose to make a top-up payment to take the employees wage back to their average weekly wage.


How long will it last?


The scheme will last for 12 weeks, starting from 26 March 2020.


How an employer participates?


An employer must register on ROS and ensure bank details are up to date.


Operation of scheme


- Employer will pay employee the calculated subsidy via payroll;

- Employer may choose to top-up the payment to the employees average weekly wage;

- Employer notifies to Revenue the payment made to the employee and

- Revenue will refund the employer within 2 days of receipt of notification


Employer Eligibility


To qualify for the scheme a business must be experiencing a significant negative economic disruption due to the Covid-19 pandemic. This is generally indicated by;


- Closure of business or ceasing of trade or

- Decrease of Turnover by 25%


A declaration by the employer is required to qualify for the scheme.

Resources

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


https://www.revenue.ie/en/corporate/communications/documents/guidance-on-employer-eligibility-and-supporting-proofs.pdf

COVID-19 Pandemic Unemployment Payment ( Employees & Self-Employed)

What is it?


The COVID-19 Pandemic Unemployment Payment is a payment of €350 per week. It is available to employees and the self-employed. Note that this payment was introduced to provide emergency income support. This is not a jobseeker's application.


How long will it last?


The COVID-19 Pandemic Unemployment Payment will be in place for the duration of the crisis.


Who can apply?


To apply, the individul;


- are aged between 18 and 66 years old and

- live in the Republic of Ireland and

- have lost your job due to the COVID-19 pandemic or

- if you are self-employed and have ceased trading due to the pandemic,


How to apply?


- Log onto www.mywelfare.ie

- Set-up an account and complete application form

- This form takes approximately 6 minutes

COVID-19 Microfinance Business Loans (Sole Traders & LTD Companies)

What is it?


Loans for SME’s (Sole Traders & Companies) ranging from €5,000 to €50,000. The first 6 months of the loan are interest or repayment free.


How long is it for?


Loan is typically up to three years.


Who can apply?


The criteria for application are as follows;


- Any business (Sole Trader, Partnership or Limited Company) with less than 10 full time employees and annual turnover of up to €2m;

- Not in a position to avail of finance from Banks and other commercial lending providers; and

- 15% of actual or projected turnover or profit is negatively impacted by COVID-1

How to apply?


- Complete application form on Microfinanceireland.ie

- Detail future cashflows

- Complete Covid 19 Business plan;

- Provide last 6 months of statements; and

- Provide latest financial statements.

COVID-19 Credit Guarantee Scheme

What is it?


To help SMEs impacted by COVID-19 related issues to have access to sufficient working capital, the government has repurposed the Credit Guarantee Scheme.


The government guarantee the loan, ranging from €10,000 to €1m


Interest rates will be at the local banks (AIB, Bank of Ireland & Ulster Bank) lending rate.


How long is it for?


The term of the loan can be up to 7 years.


Who can apply?


SME’s can apply for the loan. SME’s are considered to;


- have fewer than 250 employees;

- have a turnover of €50 million or less (or €43 million or less on their balance sheet);

- are independent and autonomous i.e. not part of a wider group of enterprises;

- have less than 25% of their capital held by public bodies; and

- is established and operating in the Republic of Ireland.


How to apply?


Engage with AIB, Bank of Ireland or Ulster Bank to begin their standard loan application process. It is only at this stage that a decision will be made on credit approval.

Upcoming Revenue Payments

What is it?


Revenue are providing several concessions with regards to upcoming tax payments. These include the following measures;


- All debt enforcement is suspended until further notice;

- Interest on late payments for SME’s in regards to Jan & Feb VAT and Feb & March Employers Liability;

- Direct Debits that bounce will not be pursued under standard Revenue Guidelines;

- Surcharge on Corporation Taxes related to June 2019 period ends are suspended.


How long is it for?


These measures are in place until further notice.


Who can apply?


These measures are aimed at SME’s.


For tax purposes, an SME is a business with turnover of less than €3 million who is not dealt with by either Revenue’s Large Cases Division or Medium Enterprises Division. SME’s are managed from both a service and compliance standpoint by Revenue’s Business Division

Businesses other than SME’s are encouraged to discuss payment difficulties with the Collector-General.


How to apply?


The above measures are already in place. However, it is important that returns are filed as per prescribed deadlines, even if no payment is due.


If payment obligations cannot be met, it is encouraged to communicate with Revenue early. A phased payment instalment arrangement can be put in place for liabilities.

Upcoming CRO Returns (Annual Return)

What is it?


The Companies Registration Office (CRO) have allowed companies that have an annual return due between now and 30 June to postpone filing until 30 June.

This is to allow businesses and their advisors to focus on immediate financial concerns.


How long is it for?

This situation is being kept under review, but the current dispensation is in place until 30 June.


Who can apply?


All companies may avail of the dispensation.


How to apply?

No application is required.


The Local Enterprise Office Business Continuity Voucher


What is it?


The voucher is worth up to €2,500 in third party consultancy costs and can be used by companies and sole traders to develop short-term and long-term strategies to respond to the Covid-19 pandemic


Who can apply?

The new Business Continuity Voucher, available through Local Enterprise Offices, is designed for businesses across every sector that employ up to 50 people.


How to apply?


Complete a quick application form on the below website.


https://www.localenterprise.ie/Portal/response/Business-Continuity-Voucher/Business-Continuity-Voucher.html


Note - the above should not be construed as advice. This is a list of resources available at the time of publication.





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