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Minister for Finance Paschal Donohoe. Leah Farrell/Rollingnews.ie

Wage subsidy scheme recipients who owe income tax won't have to pay it back until next year at the earliest

Paschal Donohoe has previously said that Revenue’s method for recouping the tax will “minismise financial hardship”.

MINISTER FOR FINANCE Paschal Donohoe has said that those who owe tax as a result of being in receipt of the temporary wage subsidy scheme (TWSS) won’t have to repay it until next year.

Speaking on RTÉ Radio 1′s Morning Ireland, the minister said said that any tax owed could be spread over future years.

He added that Revenue will liaise with each employer in relation to this.

The TWSS was introduced in late March to support employers affected by Covid-19. It subsidises the wages of workers up to €410 a week. The government is switching to a new scheme dubbed the Employment Wage Subsidy Scheme (EWSS) from next week which will see the maximum payment per week set at €203 per employee.

To date, over 69,500 employers have registered with the TWSS and over half a million people have received at least one payment on the scheme. 

While workers are liable to pay tax on the income paid to them under the TWSS, they are not being taxed on it week-to-week or month-to-month.

They’ll become liable to repay whatever tax they haven’t paid at the end of this year, with any repayments likely to be spread out over a significant period of time.

Donohoe has previously said that it’s not possible to give an accurate estimate, right now, of how much someone might owe at the end of the year or if they’ll face a tax bill at all. 

There’s a chance there might not a tax bill because a person’s tax credits may offset any potential underpayment at the end of the year. 

The minister has said though that Revenue’s method for recouping what’s owed will “minimise any financial hardship to the greatest extent possible”

In its pre-Budget submission, the Consultative Committee of Accountancy said that if an employee receives €350 per week for 22 weeks, this would amount to €7,700 in untaxed income that must be dealt with by the employee.

It has called for “definitive guidance” on the matter along with confirmation that “tax on TWSS payments will be collected over four or more years so the employee is not left with a substantial drop in take-home pay in the coming tax years”.

Speaking today, Donohoe said that unpaid tax on the scheme would be collected “over next year and beyond”.

He added that €2.7 billion had been paid to date under the TWSS, and that €2.25 billion will be invested under the new EWSS through to next April. 

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    Mute Pat Lonergan
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    Aug 1st 2018, 8:07 AM

    Day 1 and all ready I have made up my mind,what a poor selection.Really shows what a good President Micheal D is.

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    Mute Gus Sheridan
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    Aug 1st 2018, 8:32 AM

    @Pat Lonergan: shows how we are scraping the bottom of the barrel, all our best candidates have left, and we are left with the dross.

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    Mute Gus Sheridan
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    Aug 1st 2018, 8:33 AM

    @Pat Lonergan: he definitely is not.

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    Mute Boris Farage
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    Aug 1st 2018, 8:36 AM

    @Gus Sheridan: Best of that lot??? Without a shadow of a doubt.

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    Mute Pat Lonergan
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    Aug 1st 2018, 10:23 AM

    @Gus Sheridan: So which of the as of now declared candidates would you say comes with in as ass roar of Micheal D?

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    Mute Senan Hogan O'Brien
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    Aug 1st 2018, 7:58 AM

    How depressing

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    Mute James O'Brien
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    Aug 1st 2018, 8:03 AM

    A room full of headless chickens I’d say that was fun

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    Mute Colonel Grant
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    Aug 1st 2018, 10:47 AM

    There has to be a collective noun for a group of complete eejits . This was a classic case.

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    Mute Ray Hyland
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    Aug 1st 2018, 10:57 AM

    So it looks like we’re going to have a half dozen candidates again. All because it’s probably easier for the media to find stories if there’s more people involved. Pointless if you ask me.

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    Mute Victor Brown
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    Aug 1st 2018, 1:24 PM

    The Rás for The Áras…. Attention seekers

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    Mute anthony byrne
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    Aug 1st 2018, 2:57 PM

    Duffy who gets his kicks out of hunting innocent animals, not fit to represent Ireland, vile person.

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    Mute Mickey Fennessy
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    Aug 1st 2018, 10:48 PM

    Gavin Duffy if u like people who torture animals for fun

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    Mute Marie Setterfield
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    Sep 11th 2018, 5:03 PM

    Not much there to get excited about

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