Temporary Wage Subsidy Scheme


This document is about the COVID-19 Temporary Wage Subsidy Scheme, which closed on 31 August 2020. It was replaced by the Employment Wage Subsidy Scheme (EWSS).

This page can be used for reference purposes for information on the operation of the TWSS up until it closed on 31 August 2020.

The Temporary COVID-19 Wage Subsidy Scheme was announced on 24 March 2020. It replaced the Revenue Employer COVID-19 Refund Scheme.

It allowed employers to continue to pay their employees during COVID-19. It aimed to keep employees registered with their employers, so that they could get back to work quickly after the pandemic.

The new EWSS commenced on 1 July 2020. The two schemes ran in parallel from 1 July until the TWSS closed on 31 August 2020.

You can get more detailed guidance on the operation of the Temporary COVID-19 Wage Subsidy Scheme from Revenue’s Frequently Asked Questions.

Who qualified for the Temporary COVID-19 Wage Subsidy Scheme?

The TWSS closed on 31 August 2020 and no new applications can be accepted from that date.

The Scheme was available to employers from all sectors (except for the public service and non-commercial semi-state sector) who had lost a minimum of 25% of turnover because of the COVID-19 pandemic. Employers had to make a declaration to Revenue confirming this.

The scheme was available for employers who keep staff on their payroll during the pandemic. Employees could be:

  • Temporarily not working (laid off) or
  • On reduced hours and/or reduced pay

To qualify for the scheme, you must have:

  • Self-declared to Revenue that you experienced significant negative economic disruption due to COVID-19, with a minimum of 25% decline in turnover (between 14 March 2020 and 30 June 2020)
  • Been unable to pay normal wages and normal outgoings fully
  • Kept your employees on your payroll

Employees must have been on your payroll on 29 February 2020, and you must have made payroll submission on their behalf to Revenue in the period from 1 February 2020 to 31 March 2020.

Employers could not operate the scheme for employees who were making a claim for duplicate support from the DSP (such as the COVID-19 Pandemic Unemployment Payment). However if your employee was already getting a payment from the DSP such as a carers or disability payment, you could operate the scheme on their behalf.

People getting social welfare and other payments

People aged over 66 who were getting a State pension were eligible for the Temporary COVID-19 Wage Subsidy scheme and could keep their pension payment.

People getting a Working Family Payment were also eligible for the scheme, provided all other eligibility criteria were met – see ‘Rates’ below.

If you re-hired employees who were previously laid off, the employee could qualify for the Subsidy scheme if their DSP claim had ceased. Revenue shared data with DSP. The employer did not have to cease the employment for an employee to be able to receive COVID-19 Pandemic Unemployment Payment. However, if an employee was receiving both COVID-19 Pandemic Unemployment Payment and the wage subsidy scheme, DSP ceased their COVID-19 Pandemic Unemployment payment.

An employee who was receiving a TWSS payment and whose work was reduced to 3 days or less per week, could apply for Short Time Work Support which is a form of Jobseeker’s Benefit.

The Temporary COVID-19 Wage Subsidy Scheme applied both to employers that top up employees’ wages and those that were not in a position to do so.

Returning to work following maternity, adoptive leave or Parental leave or in receipt of certain DSP benefit payments

You could qualify for TWSS if you were not on your employer's payroll on 29 February 2020 because you were on:

Payment was backdated to 26 March 2020 or to the date you recommenced employment, whichever was the latest date.


On 23 June 2020 the government announced changes allowing apprentices who were not on payroll due to block release training to access the TWSS.

Apprentices who were not on their payroll in January or February 2020 because they were on an education and training programme run by SOLAS were eligible for TWSS. The changes applied from 26 March 2020, the date of return to employment or the date the employer was registered for the scheme, whichever was the latest.

People providing care

If you could not return to work due to personal circumstances, for example if you needed to care for someone, your employer could keep you on the TWSS, but was not obliged to.

Childcare Providers

The Department of Children, Equality, Disability, Integration and Youth (DCEDIY) operated a Temporary Wage Subsidy Childcare Scheme which ended on 28 June 2020. Since 29 June 2020, childcare providers could avail of Revenue’s Temporary COVID-19 Wage Subsidy Scheme. Childcare providers can find further information on gov.ie. See section 4.2 of FAQ’s.

Proofs required

Applications were based on self-assessment principles. You can read detailed information on the key indicators and supporting proofs from Revenue (pdf). Employers should continue to keep proof of their eligibility for the scheme (evidence of reduction in turnover and other evidence).

Penalties will apply to self-declaring incorrectly, not providing funds to employees or not following Revenue (or other) guidelines.

You can read about compliance checks on Revenue’s website.


The TWSS closed on 31 August 2020 and no new applications can be accepted from that date.

This information below is for reference purposes only.

The subsidy scheme refunded employers up to a maximum of €410 for each qualifying employee.

The subsidy was based on an employee's pay after tax, USC and PRSI, not their gross pay.

Levels of subsidy from 4 May 2020 to 31 August 2020

From 4 May 2020, the subsidy payment moved to a system based on the previous weekly average take home pay for each employee. The previous weekly average take home pay was based on an employee’s pay in January and February 2020.

On 4 May 2020 Revenue informed all eligible employers of the maximum personal subsidy amount in respect of each individual employee on its payroll based on the employee’s Average Revenue Net Weekly Pay.

Income thresholds Level of subsidy payment
Previous average take home pay below €412 per week 85% of the weekly average take home pay
Previous average take home pay between €412 and €500 per week Flat rate subsidy of €350 per week
Previous average take home pay between €500 and €586 per week 70% of the weekly average take home pay, up to a maximum of €410
Previous average take home pay between €586 and €960 per week Subsidy is subject to ‘tapering’. That means the level of subsidy is calculated by reference to the amount of any additional (‘top up’) payments made by the employer and its effect on the weekly average take home pay.

Subsidy levels are as follows:

  • Flat rate subsidy of €350 per week, where the employer pays a top up payment up to 60% of the employee’s previous weekly take home pay
  • Flat rate subsidy of €205 per week, where the employer pays a top up payment between 60% and 80% of the employee’s previous weekly take home pay
  • No subsidy is payable, where the employer pays a top up payment above 80% of the employee’s previous weekly take home pay

Tapering is calculated by subtracting the gross 'top up' paid by the employer from the employee’s previous average take home pay.

Previous average take home pay above €960 per week

Employee’s whose average take home pay has fallen below €960 can now avail of the scheme, subject to the tapering rules (see above).

No subsidy applies for employee’s whose current pay is more than €960. This is the case regardless of the level of any reduction in pay.

As normal business resumed and the employer’s contribution to the employee’s pay increased, TWSS payments reduced through tapering – see table above. When an employer payed normal pre-COVID wages, no subsidy was due.

TWSS and tax, PRSI and USC

Income tax and USC was not applied to the subsidy through the payroll. To reduce the amount of tax that may arise at the end of the year, Revenue placed all employees that received payments under the TWSS or PUP on a Week 1 basis. Revenue issued Week 1 Revenue Payroll Notifications (RPNs) to employers. Employers used the most recent RPN so employees were switched to the Week 1 basis as quickly as possible.

When an end of the year review takes place, an employee’s unused tax credits may be enough to cover any tax liability. Where this is not the case, and they have underpaid tax, Revenue will normally collect the underpayment by reducing the employee’s tax credits for a future year(s) in order to minimise any hardship. If the employee has any additional tax credits to claim, for example health expenses, this will also reduce any tax due.

In many cases, the payment of the Temporary COVID-19 Wage Subsidy and any additional income paid by the employer will result in the refund of income tax or USC already paid by the employee. Any income tax and USC refunds that arise as a result of the application of tax credits and rate bands can be repaid by the employer and Revenue will also refund this amount to the employer.

On 25 September 2020, Revenue provided more information on the taxation of payments under the TWSS. In January 2021, Revenue will make a Preliminary End of Year Statement available to all employees. The statement will give employees a preliminary calculation of their income tax and USC position for 2020. It will tell you whether your tax position is balanced or if you have underpaid or overpaid your tax for 2020. If you have an underpayment of taxes, the following applies:

  • You can arrange to fully or partially repay the tax due through the payments/repayments facility in myAccount, or
  • Revenue will collect the underpayment by reducing your tax credits over the following 4 years, starting in January 2022. You will not have to pay interest on any underpayment.

Employers paying employees’ 2020 income tax and USC liability

Revenue is facilitating employers who want to pay the 2020 income tax and USC liabilities of their employees, where the liability arose from the TWSS.

On a once-off, exceptional basis, an employer can make these payments, without having to apply Benefit-in- Kind (BIK) rules. This is known as concessional treatment for BIK and TWSS debts.

The concession applies to the liabilities of employees, self-assessed employees and proprietary directors (subject to certain conditions).

Employers have until end of September 2021 to make the payments on behalf of their employees.

You can get more information about how to pay your employees’ tax liabilities from Revenue.


Employee PRSI did not apply to the subsidy or to top-up payments by the employer (employees are set to PRSI class J9).

Employers PRSI did not apply to the subsidy and was reduced from 10.5% to 0.5% on the top-up payment within the thresholds set out by Revenue (see ‘Level of subsidy and income thresholds’ above). However, if the wage subsidy plus any top-up payments exceeded the thresholds, the employee was longer eligible for any subsidy and the employee returned to PRSI class A1.

Section 4.4.3 of Revenue’s FAQ (pdf) shows the impact that top-up payments had on the subsidy and PRSI class.

Employees continued to be covered by social insurance while their employer was getting a subsidy. Their PRSI entitlements was not broken and they continued to get insurable weeks or credited social insurance contributions.

Page edited: 7 June 2022