Employment Wage Subsidy Scheme (EWSS) - Important Update re Proprietary Directors

✳ One of the most 𝙘𝙤𝙣𝙩𝙧𝙤𝙫𝙚𝙧𝙨𝙞𝙖𝙡 aspects of the Employment Wage Subsidy Scheme (𝙀𝙒𝙎𝙎) was the fact that originally the intention was to 𝙚𝙭𝙘𝙡𝙪𝙙𝙚 𝙥𝙧𝙤𝙥𝙧𝙞𝙚𝙩𝙖𝙧𝙮 𝙙𝙞𝙧𝙚𝙘𝙩𝙤𝙧𝙨 from the scheme.

✳ The definition of a proprietary director is a '𝙙𝙞𝙧𝙚𝙘𝙩𝙤𝙧 𝙤𝙛 𝙖 𝙘𝙤𝙢𝙥𝙖𝙣𝙮 𝙬𝙝𝙤 𝙞𝙨 𝙩𝙝𝙚 𝙗𝙚𝙣𝙚𝙛𝙞𝙘𝙞𝙖𝙡 𝙤𝙬𝙣𝙚𝙧 𝙤𝙛 𝙤𝙧 𝙞𝙨 𝙖𝙗𝙡𝙚 𝙚𝙞𝙩𝙝𝙚𝙧 𝙙𝙞𝙧𝙚𝙘𝙩𝙡𝙮 𝙤𝙧 𝙞𝙣𝙙𝙞𝙧𝙚𝙘𝙩𝙡𝙮, 𝙩𝙤 𝙘𝙤𝙣𝙩𝙧𝙤𝙡 𝙢𝙤𝙧𝙚 𝙩𝙝𝙖𝙣 15% 𝙤𝙛 𝙩𝙝𝙚 𝙤𝙧𝙙𝙞𝙣𝙖𝙧𝙮 𝙨𝙝𝙖𝙧𝙚 𝙘𝙖𝙥𝙞𝙩𝙖𝙡 𝙤𝙛 𝙩𝙝𝙚 𝙘𝙤𝙢𝙥𝙖𝙣𝙮.'

✳ Fortunately the Minister for Finance, Paschal Donohoe, had the 𝙜𝙤𝙤𝙙 𝙨𝙚𝙣𝙨𝙚 to see how unfair that would have been, and he intervened to 𝙧𝙚𝙫𝙚𝙧𝙨𝙚 𝙩𝙝𝙖𝙩 aspect of the scheme before it was publicly announced.

✳ The guidance at the time stated that '𝙘𝙚𝙧𝙩𝙖𝙞𝙣' 𝙥𝙧𝙤𝙥𝙧𝙞𝙚𝙩𝙖𝙧𝙮 𝙙𝙞𝙧𝙚𝙘𝙩𝙤𝙧𝙨 would be able to access the scheme, but, since then there has been very little in the way of specific advice from Revenue regarding what 𝙘𝙤𝙣𝙙𝙞𝙩𝙞𝙤𝙣𝙨 these 'certain' proprietary directors would have to meet.

✳ Fortunately today (31st August 2020), 𝙍𝙚𝙫𝙚𝙣𝙪𝙚 𝙝𝙖𝙫𝙚 𝙘𝙤𝙣𝙛𝙞𝙧𝙢𝙚𝙙 𝙩𝙝𝙚 𝙘𝙤𝙣𝙙𝙞𝙩𝙞𝙤𝙣𝙨 under which proprietary directors can claim the EWSS from 1st September 2020, as follows:

✅ The employer meets the eligibility for the EWSS (turnover requirements etc.),

✅ The proprietary director is on the payroll of the eligible employer, and

✅ 𝙏𝙝𝙚 𝙥𝙧𝙤𝙥𝙧𝙞𝙚𝙩𝙖𝙧𝙮 𝙙𝙞𝙧𝙚𝙘𝙩𝙤𝙧 𝙝𝙖𝙨 𝙗𝙚𝙚𝙣 𝙥𝙖𝙞𝙙 𝙬𝙖𝙜𝙚𝙨 𝙬𝙝𝙞𝙘𝙝 𝙬𝙚𝙧𝙚 𝙧𝙚𝙥𝙤𝙧𝙩𝙚𝙙 𝙩𝙤 𝙍𝙚𝙫𝙚𝙣𝙪𝙚 𝙤𝙣 𝙩𝙝𝙚 𝙥𝙖𝙮𝙧𝙤𝙡𝙡 𝙤𝙛 𝙩𝙝𝙚 𝙚𝙡𝙞𝙜𝙞𝙗𝙡𝙚 𝙚𝙢𝙥𝙡𝙤𝙮𝙚𝙧 𝙖𝙩 𝙖𝙣𝙮 𝙨𝙩𝙖𝙜𝙚 𝙗𝙚𝙩𝙬𝙚𝙚𝙣 1𝙨𝙩 𝙅𝙪𝙡𝙮 2019 𝙖𝙣𝙙 30𝙩𝙝 𝙅𝙪𝙣𝙚 2020.

✳ 𝙏𝙝𝙚 𝙠𝙚𝙮 𝙘𝙤𝙣𝙙𝙞𝙩𝙞𝙤𝙣 𝙞𝙨 𝙩𝙝𝙚 𝙡𝙖𝙨𝙩 𝙤𝙣𝙚, 𝙬𝙝𝙞𝙘𝙝 𝙄 𝙗𝙚𝙡𝙞𝙚𝙫𝙚 𝙬𝙞𝙡𝙡 𝙘𝙖𝙪𝙨𝙚 𝙩𝙝𝙚 𝙢𝙤𝙨𝙩 𝙘𝙝𝙖𝙡𝙡𝙚𝙣𝙜𝙚𝙨, 𝙖𝙨 𝙖𝙨 𝙣𝙤𝙩 𝙖𝙡𝙡 𝙥𝙧𝙤𝙥𝙧𝙞𝙚𝙩𝙖𝙧𝙮 𝙙𝙞𝙧𝙚𝙘𝙩𝙤𝙧𝙨 𝙖𝙧𝙚 𝙤𝙣 𝙥𝙖𝙮𝙧𝙤𝙡𝙡, 𝙤𝙧 𝙖𝙧𝙚 𝙥𝙖𝙞𝙙 𝙞𝙣 𝙖 𝙧𝙚𝙜𝙪𝙡𝙖𝙧 𝙛𝙖𝙨𝙝𝙞𝙤𝙣.

✳ Where a person is a proprietary director of two or more eligible companies, a claim for EWSS can only be submitted in respect of a single company. In this situation the following will apply:

• the proprietary director will be required to elect one company for the purposes of making EWSS claims for the period of the scheme. The election will be deemed to be made on the first submission of an EWSS claim in respect of the proprietary director,  

• once an election is made it cannot be changed during the term of the scheme, 

• no claims for EWSS in respect of the same proprietary director should be submitted by the other companies. 

✳ Where you plan to apply for the EWSS, please do not delay. Do the following two things today:

1. Apply for Tax Clearance, and

2. Register for the EWSS via ROS

✳ To find out how we can help you with this and/or find out about our other services please free to contact us by email at:

𝙝𝙚𝙡𝙡𝙤@𝙩𝙧𝙖𝙫𝙚𝙧𝙨𝙖𝙘𝙘𝙤𝙪𝙣𝙩𝙞𝙣𝙜.𝙞𝙚