Questions and Answers

If I use my rainy-day fund for a month’s wages will I qualify for the COVID-19 Wage Subsidy?

I have built up a small fund in my business bank account for a rainy day. It would cover me for one month’s wages but I want to make sure I have income to restart the business, will I still qualify?

It is our interpretation at this point that you will still qualify for the COVID-19 Wage Subsidy if you use your rainy-day fund to pay wages. However, Revenue would encourage you top up your staff to their normal full wages. The revenue’s guidelines state that “An employer that has been hit by a significant decline in business but has strong cash reserves, that are not required to fund debt, will still qualify for the Scheme but the Government would expect the employer to continue to pay a significant proportion of the employees’ wages."

Learn for about the scheme here.

Published 27/03/2020

Date published 27 Mar 2020 | Last updated 27 Mar 2020

This article is intended to inform rather than advise and is based on legislation and practice at the time. Taxpayer’s circumstances do vary and if you feel that the information provided is beneficial it is important that you contact us before implementation. If you take, or do not take action as a result of reading this article, before receiving our written endorsement, we will accept no responsibility for any financial loss incurred.

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