Tax during Covid19

Plasandrunt

Hi

So I work for a company that is considered essential. I get paid fortnightly as when recieving my pay on Monday I'd been paid nearly €500 more than usual. Upon enquiring about this i told that the company is now availing of the government subsidy scheme.

We were then gien a vague explanation on how this tax is going to be retrieved and nobody is entirely sure? Does this mean I won't be paying much tax until this subsidy scheme ends? If so will it be taken back in bulk sums when things are back to normal or will i be taxed pro rata?

Plasandrunt

Plasandrunt wrote: »

Hi

So I work for a company that is considered essential. I get paid fortnightly as when recieving my pay on Monday I'd been paid nearly €500 more than usual. Upon enquiring about this i told that the company is now availing of the government subsidy scheme.

We were then gien a vague explanation on how this tax is going to be retrieved and nobody is entirely sure? Does this mean I won't be paying much tax until this subsidy scheme ends? If so will it be taken back in bulk sums when things are back to normal or will i be taxed pro rata?

You'll be taxed at the end of the year. Normally Revenue only do a prior tax year recheck when PAYE employees request a P21, however, for 2020 they have implied it will be done for at least employees where a Covid19 subsidy was applied on your behalf.

So, you might want to keep that extra money aside.

antix80

Plasandrunt wrote: »

We were then gien a vague explanation on how this tax is going to be retrieved and nobody is entirely sure? Does this mean I won't be paying much tax until this subsidy scheme ends? If so will it be taken back in bulk sums when things are back to normal or will i be taxed pro rata?

Yes, you'll be taxed a lot less.. Think of it as an interest-free loan. If you can afford to, compare your pay to what you got in the previous period and put that money aside.

No one knows how the government will collect the underpayment. There's a good chance they'll calculate it automatically at the end of the year and issue a demand for it. They might reduce any unpaid amount from future tax credits/reduce your pay in future years.

Apparently no deductions can be made from it. Our company isn't deducting tax, pension, lpt, maybe travel saver

dancingqueen

No BIKs are being deducted I think. Definitely not taxsaver and pensions. It will create a lot of confusion for a lot of people I'd imagine

Addle

If your job is considered essential, how come you’re not working?

Addle

Addle wrote: »

If your job is considered essential, how come you’re not working?

Where did they say that?

dancingqueen

dancingqueen wrote: »

No BIKs are being deducted I think. Definitely not taxsaver and pensions. It will create a lot of confusion for a lot of people I'd imagine

Each employee has to be looked at individually. We're deducting BIKs and pensions etc when calculating salary to be paid.

PommieBast

My company is availing itself of the Covid19 scheme but has also given us a top-up to 80% of normal salary. Top-up part and medical BIK is taxed, but Covid19 part isn't.

Says a lot about personal taxation levels that my nett pay is actually higher than last month..

Plasandrunt

Addle wrote: »

If your job is considered essential, how come you’re not working?

I am still working, never said I wasnt

PommieBast

PommieBast wrote: »

Says a lot about personal taxation levels that my nett pay is actually higher than last month..

It's unlikely to be next month.

Staff here in a similar situation have been advised to put money aside to pay the tax that will be due at the end of the year.

PommieBast

Deleted User wrote: »

Staff here in a similar situation have been advised to put money aside to pay the tax that will be due at the end of the year.

I do wonder how many can/will though. Probably more a topic for the Politics boards but I would not be surprised if it sparks off a big backlash come xmas..

Addle

Plasandrunt wrote: »

I am still working, never said I wasnt

Apologies, I thought these schemes were only for employees who are out of work.

Plasandrunt

Addle wrote: »

Apologies, I thought these schemes were only for employees who are out of work.

I think companies that are down a certain percent of their profits but need to stay open can avail of the scheme.

Rubberchikken

What's the point of giving extra now but looking for it back in tax at year end.
I actually don't agree with it, am still working in my ,'essential' job and have requested to change back to the normal way.
Also didn't appreciate that I wasn't asked about it but had it decided for me.

PommieBast

Rubberchikken wrote: »

What's the point of giving extra now but looking for it back in tax at year end.

Most likley because giving an actual tax holiday in itself would put a big hole in government finances.


More practically is how much people "should" be putting away. Will it just be taxed flat-rate or will they chase people for how much they would have paid if it was treated as normal salary.

antix80

Rubberchikken wrote: »

I actually don't agree with it, am still working in my ,'essential' job and have requested to change back to the normal way.
Also didn't appreciate that I wasn't asked about it but had it decided for me.

I don't think you get it.

Your essential job may not exist if your company folds. Therefore, your employer applied for the government subsidy. It's free money to the company and covers most of your wages. Your employer is not allowed to make deductions from the payment.