New Covid-19 Supports Announced By Irish Government

Over the bank holiday weekend, additional business supports were announced by the Government.

Details are still being fleshed out, but here are a few highlights:

A €10,000 restart grant for micro and small businesses based on a rates/waiver rebate from 2019
A three month commercial rates waiver for impacted businesses;
A €2 billion Pandemic Stabilisation and Recovery Fund within the Ireland Strategic Investment Fund (ISIF), which will make capital available to medium and large enterprises on commercial terms;
A €2 billion COVID-19 Credit Guarantee Scheme to support lending to SMEs for terms ranging from 3 months to 6 years, which will be below market interest rates;
The ‘warehousing’ of tax liabilities for a period of twelve months after recommencement of trading during which time there will be no debt enforcement action taken by Revenue and no interest charge accruing in respect of the warehoused debt;
A commitment to local authorities to make up the rates shortfall, so that local authorities can continue provide full services to the public.

Go here for more information.

https://dbei.gov.ie/en/News-and-events/Department-News/2020/May/02052020.html

We’ll certainly share more information as it emerges.

Previously the Government announced a range of supports. Here are the highlights incase you haven’t seen them.

A. Employment Supports

The Government, in conjunction with the DEASP and the Revenue Commissioners have introduced two major supports to business’s and employees in this time of unprecedented crisis.

Pandemic Unemployment Payment (PUP):

This payment, €350 per week, is available to all employees and the self-employed, who lost their work due to a downturn in economic activity caused by the Covd-19 Pandemic and who had been employed up to or after March 13th, 2020. This support will be in place for a period of 12 weeks.

Originally introduced at a rate of €203 per week and for a period of 6 weeks, the PUP was increased as the scale of the crisis unfolded. The main criteria to qualify for the PUP are

aged between 18 and 66 years of age
live in the Republic of Ireland
lost your job due to the Covid-19 Pandemic
self-employed and ceased trading due to the Covid-19 Pandemic
been temporarily laid off or asked to stay at home and not getting any money from your employer.

You do not qualify for the PUP if you voluntarily left your employment or self-employment.

Anybody with adult and/or child dependants should also claim for job-seeker’s benefit as they will be eligible for additional dependant payments.

Wage Support Scheme

In order to support employers that can remain open but may be unable to pay full wages due to downturn or that may have had to temporarily close but want to maintain employment links with their employees, the wages subsidy scheme was introduced.

The wages subsidy scheme aimed to pay a subsidy of 70% of an average net weekly wage (January/February, 2020) for those earning less than €585 per week or €350 per week for those with net average weekly earning between €586 and €960 per week. Anybody with a net weekly wage in excess of €960 does not qualify.

However, as this scheme was introduced at great speed, there were some anomalies which were addressed by the Minister for Finance on 15.04.2020. These included an increase in the subsidy from 70% to 85% for lower paid workers i.e. those with average net pay less than €412 per week; a subsidy of up to €350 per week for those with average net pay €412-€500 per week; the introduction of a tiered subsidy for those with average net earnings more than €586 per week and mechanism for those with average net earnings more than €960 per week to avail of a subsidy if their earnings fall below that level.

Eworking and employees

Did you know that employees working from home can claim tax relief? This payment is to cover expenses such as heating and electricity costs.

Revenue allows an employer to make payments up to €3.20 per day to employees who satisfy the conditions for the relief, without deducting PAYE, PRSI, or USC. The payment itself is taxable.

E-working is when you work:

At home on a full- or part-time basis
Part of the time at home and the remainder in the normal place of work

As always, you can get more information from www.revenue.ie

B. Other Revenue Measures

Revenue have introduced a number of other measures to assist businesses experiencing cash flow difficulties, and who may be worried about maintain tax compliance.

Tax Returns:
Even if businesses are experiencing cash flow difficulties, tax returns should continue to be submitted on time.

Interest:
The application of interest on late payments is suspended for January/February VAT and for February and March PAYE Liabilities.

Debt Enforcement:
All debt enforcement activity is suspended until further notice

Tax Clearance:
The current tax clearance status of all businesses will remain in place for the coming months

Sub-Contractors (RCT):
A general rate review scheduled for March, 2020 was suspended as this may have resulted in the rate increasing due to a change in the compliance position during the current crisis.

C. Business Supports – Local Enterprise Office

New Covid19 Microfinance Business Loan

The COVID-19 Business Loan from Microfinance Ireland is a government initiative to support small businesses through the current period of uncertainty and protect job creation or sustainment in Ireland.

If your business is impacted or may be impacted by COVID-19 resulting in a reduction of 15% or more in actual or projected turnover or profit, AND you are having difficulty in accessing finance from commercial lending providers, the MFI COVID-19 Business Loan may be able to help your business.

In addition, Local Enterprise Offices in every county provide a range of business supports for micro-enterprises including business continuity and preparedness advisory supports connected to the COVID-19 outbreak. Contact your Local Enterprise Office for more information.

Product Features

Loans from €5,000 – €50,000
Supports businesses who have been impacted negatively by coronavirus in Ireland
Loan terms typically up to 3 years
First 6 months – Interest & Repayment free
No fees / no hidden costs / charges
Fixed repayments / no penalty for early repayment

Eligibility

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
15% of actual or projected turnover or profit is negatively impacted by COVID-19

For more information please see

https://microfinanceireland.ie/loan-packages/covid19/

Business Continuity Voucher

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

The goal is to help companies make informed decisions about what immediate measures and remedial action should be taken, to protect sales and staff.
If your application is successful, a qualified expert will be selected by your Local Enterprise Office to work with you on your business continuity plans. The value of this service is up to a maximum of €2,500.

For more information, please visit https://www.localenterprise.ie/response/Business-Continuity-Voucher/ .

Mentoring

Clients of Local Enterprise Offices can work with an experienced mentor to identify solutions to areas of exposure within their business given the current COVID-19 challenges

For more information please visit https://www.localenterprise.ie/response/Business-Continuity-Voucher/

D. Business Supports – Enterprise Ireland

Covid-19 Business Financial Planning Support

The COVID-19 Business Financial Planning Grant is a new support for Enterprise Ireland clients and those manufacturing or internationally traded services companies that employ 10 or more full time employees. The grant is designed to help companies to develop a robust financial plan, including the preparation of documentation required to support applications for external finance from banks and/or other finance providers (including Enterprise Ireland). The COVID-19 Business Financial Planning Grant, worth up to €5,000, will enable companies to access external support from approved financial consultants to prepare a financial plan to secure the company in the short to medium terms.

The financial plan will:

help the company to understand its immediate financial position, secure the finance it requires to survive and provide a framework to sustain the business
ensure that the company has a framework to identify and manage its costs and gaps in funding
be 100% funded up to €5,000 to access an approved financial consultant
be open to all Enterprise Ireland clients and companies employing 10 or more in the manufacturing and internationally traded services sector
be open via online application. Available from Enterprise Ireland.

For more information please visit https://enterprise-ireland.com/en/About-Us/Services/Covid-19/Supports/

Other Supports

Enterprise Ireland has a range of other supports for companies who are being impacted by COVID-19 (https://enterprise-ireland.com/en/About-Us/Services/Covid-19/Supports/). These include:

Strategic Consultancy Grant The grant funds the hiring of a strategic consultant to support the development and/or the implementation of new strategic initiatives to facilitate business growth.

COVID-19 Act On Supports The Act On Initiative offers advice, support and access to external consultants on strategic sourcing and transport & logistics.

Key Manager Grant The Key Manager Grant provides partial funding towards the recruitment of a full or part-time manager with critical skills to promote the business and future growth

3 . Business Process Improvement Grant

The business process improvement grant can be used to support short to medium term company projects that improve efficiencies and business process improvements. Specific E-marketing support is available through this grant to develop and enhance your company’s capability to use the internet as an effective channel for business development.

“Finance in focus”
A grant of up to €7,200 available to Enterprise Ireland and Údarás na Gaeltachta clients to support financial planning
Be Prepared Grant
Designed for Enterprise Ireland clients who would benefit from further research and external expertise in examining their exposure to COVID-19 and exploring ways of addressing this.
The Business Process Improvement Grant
Used to support short to medium term company projects that improve efficiencies and business process improvements. Specific E-marketing support is available through this grant to develop and enhance your company’s capability to use the internet as an effective channel for business development

E. Other Organisational & Funding Supports & Information

There are a variety of other supports available to you, some newly formed due to this global pandemic and others which have been established for quite some time. Contact us to discuss which options are most suitable for your situation.

Short Time Work Support

Is available from the Department of Employment Affairs and Social Protection and is an income support payment for employees who have been temporarily placed on a shorter working week and is intended to help employers during periods of temporary difficulty.

SBCI Credit Guarantee Scheme

This is a government supported product from the banks for small and medium businesses who have difficulty borrowing from their bank. Businesses can apply for loans of up to €1 million at AIB, Bank of Ireland or Ulster Bank. Loans can be for terms of up to seven years. The scheme provides an 80% guarantee to participating banks which are AIB, Bank of Ireland and Ulster Bank.

SBCI COVID-19 Working Capital Loan Scheme

The SBCI COVID-19 Working Capital Loan Scheme is offered in partnership with the Department of Business Enterprise and Innovation, the Department of Agriculture Food and the Marine and is supported by the InnovFin SME Guarantee Facility, with the financial backing of the European Union under Horizon 2020 Financial Instruments. Loans can be provided for future working capital requirements or to fund innovation, change or adaptation of the business to mitigate the impact of COVID-19.

COVID-19 Pandemic Unemployment Payment

From the Department of Employment Affairs and Social Protection this payment is available to all employees and the self-employed who have lost employment due to a downturn in economic activity caused by the COVID-19 pandemic.

Commercial Rates Deferral

The Government has agreed with local authorities that they should agree to defer rates payments due from the most immediately impacted businesses – primarily in the retail, hospitality, leisure and childcare sectors, for three months, until end-May. This measure will be implemented by each local authority in its own area.

Department of Business, Enterprise and Innovation

The Department have a Business Continuity Planning Checklist with some of the key risks to the continuity of your business activities during the outbreak of COVID-19 and a list of preparatory actions that can be taken to respond.

Department of Agriculture, Food and Marine

Keeping food and other processing facilities operational, ensuring that payments and commercial activities that are necessary to protect farm incomes can continue and that fishermen can continue to land fish and place them on the market are among the critical priorities for the Department.

Companies Registration Office (CRO)

Unfortunately, due to the global COVID-19 pandemic, the CRO is not in a position to process submissions or answer queries at this time. The CRO has decided that that all annual returns due to be filed by any Company between now and up to 30th June 2020 will be deemed to have been filed on time if all elements of the annual return are completed and filed by that date. The CRO and CORE online systems remain available.

First Responder Support Service

This is available through the Intreo Offices and development agencies, Enterprise Ireland and IDA Ireland in each region to provide tailored supports for affected businesses; Department of Employment Affairs and Social Protection Short Term Work Support Scheme.

Banking and Credit Measures

All the banks have announced that they will offer flexibility to their customers, and they may be able to provide payment holidays or emergency working capital facilities. The main non-bank lenders also confirmed their intention to also support the range of measures announced by the country’s main banks.. A deferral of up to 3-months on loan repayments will be available to many businesses. In addition, the banks are adopting a customer-focused approach to these businesses with a wide variety of tailored supports including extensions of credit lines, risk guarantees, and trade finance. These supports complement the range of government supports available through the Strategic Banking Corporation of Ireland.

The Central Bank has confirmed that it will allow banks to dip into their rainy-day capital reserves to keep lending flowing. It is anticipated that this move could free up considerable additional credit for households and businesses.

A small but important change for many businesses is the limit for contactless credit card payments has been raised from €30 to €50.

Finally…we are here to help…

This all might seem a bit confusing to know what help you can get and where you can get help with.

In this time of flux, we are monitoring the situation daily as it evolves and will advise updates as they become available.

A Tough Times Checklist and Income Support Decision Tree, to help you manage the impacts of the crisis and plan for the future.

If you would like to talk to us about how we can help you apply for the schemes or discuss how you should proceed at this time please do not hesitate to call+353 41 9844525 or email info@taxplusaccountants.ie and we will get back to you as quickly as possible.