Businesses give €105m Covid wage supports back to Revenue

Some were overpaid due to errors, others were correctly claimed but repaid when the firm’s eligibility was found to have lapsed
Over €105m in Covid subsidies has been paid back by businesses, with more expected to be recouped by Revenue in the coming year. Revenue has confirmed that about 3,300 employers have returned payments received under the employment wage subsidy scheme (EWSS), both under voluntary repayments and as a result of compliance checks. “Revenue’s experience to date is that the vast majority of beneficiary businesses operate the subsidy schemes in good faith and in accordance with the underpinning legislation,” a spokesperson said. The spokesperson confirmed that €105m had so far been returned for a number of reasons, including where amounts were incorrectly claimed as a result of clerical errors included in payroll submissions. Other businesses have paid back the State support in instances where they were initially eligible for the scheme and correctly claimed payments but as a result of completing the required monthly eligibility review, their future performance forecast indicated they were no longer eligible. Along with risk-based, real-time compliance checks, Revenue said there had been instances where individual applicants were contacted in relation to their participation in EWSS. “To date, Revenue have completed compliance interventions in respect of just over 4,100 employers in accordance with the Code of Practice for Revenue Audit and Other Compliance Interventions,” it said. “As a result of these interventions, Revenue has recouped approximately €24.7m from approximately 1,900 employers. There are further compliance checks with 2,100 employers ongoing, which will be finalised in due course. Compliance interventions are expected to continue to be initiated throughout 2022. There are a number of ways in which businesses can repay EWSS amounts determined as a result of a compliance intervention. Some businesses may make a repayment in full, while others may agree to repay in a phased payment arrangement. Such businesses may be eligible to avail of the debt warehousing scheme, which allows them to ‘park’ the amount owed on an interest-free basis until 2023. The €105m, therefore, includes some but not all of the €24.7m arising as a result of EWSS compliance activity. Speaking in the Dáil before Christmas, Tánaiste Leo Varadkar urged companies that recorded “substantial profits” or that were in a position to pay “substantial dividends” to pay back the supports received under the EWSS. At the time, Mr Varadkar said: I know some companies have done that in fairness. Others have not and I think they should. However, there is no obligation on profitable businesses to repay the State support once they fell within the requirements when they received it. A Revenue spokesperson said: “The matter of what dividends a company that is claiming/has claimed support under the EWSS may or may not pay to shareholders does not fall within the remit of the EWSS. It is not a matter covered in the overarching legislation of the scheme. The spokesperson added: “An integral part of Revenue’s role is to protect exchequer funding. Revenue supports the very high levels of voluntary compliance right across the tax code by undertaking timely, effective and proportionate actions in response to risk(s). This approach to risk management applies right across the tax code and the Covid-19 support schemes we administer on behalf of the Government.”