Revenue confirms added time to meet any Covid-19 tax liabilities                     

The PUP and the temporary wage subsidy scheme (TWSS) at one stage supported hundreds of thousands of people who would otherwise have lost their jobs during the coronavirus economic storm. Photo: Gareth Chaney/Collins

The Revenue has confirmed it will give extra time for people to pay any outstanding tax on the Covid-19 pandemic unemployment payments and the former wage support scheme. 

The PUP and the temporary wage subsidy scheme (TWSS) at one stage supported hundreds of thousands of people who would otherwise have lost their jobs during the Covid-19 economic storm. 

However, many recipients were shocked to learn the payments, like any other income were subject to personal taxation, meaning recipients could face a tax liability. In a statement, the Revenue reiterated that any income is liable to income tax and the universal social charge.  

"However, TWSS and PUP payments were not taxed in real time and instead are liable to income tax and USC at the end of the year," Revenue said.

Employees will have an opportunity to update their personal record, declare any additional income, and claim additional tax credits due, such as qualifying health expenses, via myAccount, to arrive at their final liability for 2020.

"Otherwise, Revenue will collect the liability, interest-free, by reducing the employees' tax credits over four years to minimise any hardship. The reduction of tax credits will start in January 2022,” it said. 

The TWSS was replaced this month by a new scheme, the employment wage subsidy scheme (EWSS).     

Paschal Donohoe said 82% of employers who had registered under the former wage support scheme had signed up to the new EWSS.

“I will continue to monitor closely the administration of the EWSS as well as the uptake and utilisation of this important economy-wide employment measure in the weeks and months ahead with a view to ensuring that it achieves its objective of supporting viable enterprises and employers,” he said.