#Open journalism No news is bad news

Your contributions will help us continue to deliver the stories that are important to you

Support The Journal
Dublin: 11°C Saturday 31 October 2020
Advertisement

Explainer: How will the government's new Covid support scheme for businesses work?

Applications for the scheme will open next week.

Image: PA

IT’S A CENTRAL plank of the government’s effort to help businesses adapt to the challenges of the pandemic but how will the new Covid Restrictions Support Scheme  (CRSS) actually work?

In a nutshell, the CRSS, announced today as part of Budget 2021, is a cashflow support scheme for businesses that have had to close or restrict access to customers following the move to Level 3 in the government’s ‘Living with Covid’ plan.

It will be available to businesses that have suffered an 80% decline in turnover — calculated with reference to the business’s turnover in 2019 — during the period of closure.

It’s expected that the first payments under the scheme will be made as early as mid-November but only businesses with an annual turnover of less than €2 million will be eligible.

Those eligible businesses will receive a maximum €5,000 cash payment under the CRSS. That payment will come from the Revenue Commissioners in the form of an advanced tax credit.

Businesses will be entitled to 10% on the first €1 million in turnover and 5% on anything above that to a maximum value of €5,000.

Once it has been paid out, the money can be used to pay rent and any other business-associated costs.

‘There will be audits’

Speaking at a post-Budget briefing this afternoon, Tánaiste and Business Minister Leo Varadkar said that the scheme will come on-stream this evening.

Those who meet the criteria have been urged to contact the Revenue Commissioners as soon as possible.

“It applies from the Budget, so it kicks in tonight. It’s not retrospective, applications will open next week,” he explained.

Varadkar also said that qualification for the scheme is based on self-assessment but that “there will be audits”.

“It’s self-assessed, so we’re putting a lot of faith in business people to tell us the truth about their position. It’s self-assessed, but there will be audits obviously after the fact,” he said.

The payments will cease when restrictions are lifted, and the entire scheme is due to close on 31 March 2021, however, Varadkar raised the possibility of extending it in the future.

#Open journalism No news is bad news Support The Journal

Your contributions will help us continue to deliver the stories that are important to you

Support us now

“When we look at it again in the new year, we have to be in a position to make decisions. Like for example, extending the Pandemic Unemployment Payment for a longer period; making sure that the wage subsidy scheme is there for as long as needed; and maybe extending the CRSS,” he said.

Commenting on the announcement, Peadar Andrews, Tax Partner at accountancy firm EY, described it as a “much-needed cash flow injection” for businesses affected by restrictions.

Vintners Federation of Ireland chief executive Padraig Cribben also welcomed the move.

“The CRSS provides a degree of hope in that it will supply much-needed grant support to publicans for the next five months if we remain at Level Three or higher.  

“The new scheme provides a bridge to the future where Covid is over and normal life resumes. Publicans have paid a huge price for closing their businesses so this announcement is the least they deserve.”

About the author:

Read next:

COMMENTS (5)

This is YOUR comments community. Stay civil, stay constructive, stay on topic. Please familiarise yourself with our comments policy here before taking part.
write a comment

    Leave a commentcancel