Call to ease tax burden from pandemic schemes
The group representing Irish accountancy bodies has called for tax due from workers under the Temporary Wage Subsidy Scheme (TWSS) and Pandemic Unemployment Payment to be spread over four years or more.
In its 2021 pre-budget submission, the Consultative Committee of Accountancy Bodies – Ireland (CCAB-I) said such tax concessions from the government were “urgently required”. Workers are liable for tax at the end of the year under both schemes.
Substantial
“For example, if an employee receives €350 per week under the TWSS, this amounts to €7,700 over 22 weeks and is a substantial amount of untaxed income for a worker to deal with at the end of the year,” the body said.
Tax due on these payments should be spread over four years or more to avoid a significant drop in workers’ take-home pay, it said.
CCAB-I also called for emergency measures for the SME sector in Budget 2021 to help small firms to withstand the impact of COVID-19 in the coming months.
'Extraordinary' measures
While the group acknowledged the “unprecedented” supports provided so far, it warned that many small businesses in Ireland would not survive without further “extraordinary” measures.
One of its suggestions is to write down the first €10,000 of the 2019 tax liability of self-employed people who are in financial difficulty.
Other proposals include:
- Changes to the system of tax credits for research and development to help SMEs
- A digital tax credit for small businesses
- The “refining” of the Employment Incentive and Investment Scheme (EIIS) rules to generate equity funding for SMEs