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Contents
Pandemic Unemployment Payment (PUP)
2021 Rates for Pandemic Unemployment Payment 
Schedule of Payment Dates for PUP in 2021
COVID-19 PUP Social Insurance Contributions
Taxation of Pandemic Unemployment Payment 
PUP Taxable in Real Time for 2021
Issue Relating to the Definition of Taxable in Real Time
Issue of Tax Credit Reduction Certificates
No Communication of Process for Recouping Tax on PUP before 11th February
Tax Credit Certs issued in Error Reversed by Revenue
PAYE Workers Overtaxed in Error
Overtaxed Workers Receive no Explanation Regarding Crippling Tax Deductions Made in Error
Process for Taxation of PUP in 2021
Annualising Tax Credit and Band 1 Credit Reductions for PUP

DSP Notifies Revenue of PUP of Weekly Amounts Paid
How to Close Pandemic Unemployment Payment

DSP Cease Payment of PUP
DSP Notifies Revenue of Actual Paid in PUP

Revenue Update Corrected Tax Credit Certificate
Revenue Issue Revised Payroll Notification (RPN) to Employer
Issue Relating to the Reduction of Tax Credits for Annualised PUP Rates
 
Delays in the Process Inevitable
 
Taxation of PUP in Real Time is Idealistic
BPPM Supports for PAYE Workers During Pandemic
Gross Pay to Net Pay Calculator
TWSS Rate Entitlement Calculator
Temporary Wage Subsidy Scheme Ready Reckoner
End of Year 2020 Tax and USC Calculator
PAYE Tax Calculator 2021

Conditions Not Ideal for Revenue Process
Over Taxation on Wages after Returning to Work
Example of Revenue Process to Tax PUP in Real Time
How to Check Tax Credit Certificate

Why People Returning to Work are Overtaxed
BPPM Solution to End Over Taxation of Workers

What all Workers with Reductions of Tax Credits for PUP Can Do


Pandemic Unemployment Payment (PUP)

Pandemic Unemployment Payment (PUP) is a social welfare payment for employees and self-employed people who have lost all their employment due to COVID-19.The COVID-19 Pandemic Unemployment Payment will continue to be paid until 31st March 2021 and beyond. The first thing BPPM advises anyone in receipt of PUP and returning to work at some stage in 2021 is to check their latest Revenue Tax Credit Notificaion on Revenue or follow the process outlined on this page.

2021 Rates for Pandemic Unemployment Payment   

From 1st January until 31st March 2021 the Pandemic Unemployment Payment will be paid at 4 rates based on previous earnings.

-if you earned less than €200 per week - the rate of PUP is €203 per week

-if you earned between €200 and €299.99 per week - the rate of PUP is €250 per week

-if you earned between €300 and €399.99 per week - the rate of PUP is €300 per week

-if you earned €400 or more - he rate of PUP is €350 per week.
  

Schedule of Payment Dates for PUP in 2021

The COVID-19 Pandemic Unemployment Payment is paid weekly on a Tuesday. The COVID-19 Pandemic Unemployment Payment is paid on a weekly basis. There is no part-week or daily rate.The payment week runs from Friday to the following Thursday. A person who closes their claim to return to work and has at least one qualifying day in the payment week is entitled to full payment for that week. The payment week for the Pandemic Unemployment Payment runs from Friday to Thursday and payments are paid on the following Tuesday. Individuals who have closed their PUP on Monday 24th May, as they have returned to work, will receive their final PUP payment on Tuesday 1st June. See more in  the Facebook Group Payroll Matters in Ireland which is free to join for anyone living in Ireland.

PUP Payment Schedule

COVID-19 Pandemic Unemployment Payment Social Insurance Contributions

Employees will be deemed to have made an employment contribution in respect of each week in which they are in receipt of the COVID-19 Pandemic Unemployment Payment. The contribution attributed to the person will be the same as the contribution that was made in the week immediately before they claimed the COVID-19 Pandemic Unemployment Payment. Self-employed people who are eligible for the COVID-19 Pandemic Unemployment Payment will be awarded their full annual complement of 52 contributions in the normal way.

Taxation of Pandemic Unemployment Payment

Youtube Video explaining the Background to the Flawed Process. Please feel free to like share comment or follow.


Taxation of Pandemic Unemployment Payment

During 2020 the payment of PUP was not taxable at the time of receipt from Department of Social Protection (DSP). For the year 2020 PUP tax liabilities would become due at the end of 2020. Revenue issued an update on the process for taxing the Pandemic Unemployment Payment (PUP) on 11th February 2021. All PUP payments paid in the period March 2020 to 31st December, 2020 were earned in 2020 and included in preliminary end of year Statements. The tax due on all PUP payments paid in the period March 2020 to to 31st December, 2020 were earned in 2020 and will be recouped by way of tax credit reductions over a 4-year period from 2022 to 2025, unless individuals wish to make alternative arrangements with Revenue. The process for the taxation of the Pandemic Unemployment Payment has been changed. From 1 January 2021 PUP payments earned in 2021 are taxable in real-time.

PUP Taxable in Real Time for 2021

Zero tax credits & astronomical income tax deductions may face PAYE workers returning to work in 2021 after receiving the pandemic unemployment payment. There are a couple of issues to bear in mind regarding revenues' statement that "From the 1st January 2021 PUP payments earned in 2021 are taxable in real time". If you are receiving PUP, Maternity or Illness Benefit and you have received a Tax Cert reducing your Tax Band and Tax Credit by your weekly payment of PUP, Maternity or illness benefit multipled by 52, you can calculate the amount of tax you will pay based on this certificate for any given taxable pay.

Issue Relating to the Definition of Taxable in Real Time

BPPM does not understand what Revenue mean by real time because it is the Department of Social Protection (DSP) that make the payment and if it was taxed in real time, then the DSP would have to deduct the tax when they made the payment. To attempt to circumvent this anomaly Revenue have stated that "Tax on Social Welfare payments, including PUP, are calculated on an ‘earnings basis’. These payments are subject to income tax, based on when the payments were earned, rather than when they were received.

"If something is done in real time there is no noticeable delay between the action and
its effect or consequence", as per Collins Dictionary. BPPM believes that the term is inappropriate for the process underway by Revenue to collect tax due on the PUP. For example, for someone working in the retail sector and in receipt of PUP each week from 1st January to 15th March 2021 and returns to work on 16th March, they receive their 1st payment of wages from their employer on Friday 26th March at which time they would be deducted tax on their wages together with outstanding tax due on their PUP payments. For this Retail Business

Pay Period Ending



So, for a Pandemic Unemployment Payment received on 19th January 2021, the person starts to pay the outstanding tax due on this on 26th March. That is some stretch on the use of the term Real Time. Payroll processing is deadline driven and terminology used must be clear and unambiguous, buzz words like "real time" must be well defined.

Issue of Tax Credit Reduction Certificates

In its website update on 11th February, Revenue stated "The Department of Social Protection DSP has provided Revenue with the total amounts earned by recipients throughout 2020, including Pandemic Unemployment Payments (PUP). Pandemic Unemployment Payments are subject to Income Tax only. Your Statement of Payments from the Department of Social Protection may describe these as Exceptional Needs Payments. From 1st January 2021 PUP payments earned in 2021 are taxable in real-time".

This brings BPPM on to the "Glitch" for the want of a better word in the initial process put in place between DSP and Revenue. Revenue issued revised Tax Credit Certificates for 2021 to PUP recipients between January 2021and 6th February, with an effective of February 2021 to 31st December 2021 on a Week 1/ Month 1 basis.

Tax Credit Reduction Certificates

No Communication of Process for Recouping Tax on PUP before 11th February

BPPM deduced this from posts people put on Social Media between 4th to 7th February 2021. Workers returning to work were having almost 40% of all their wages deducted as income tax. At that point, neither Revenue nor DSP had issued any statement or had any update on their Website. The level of confusion this caused among working people who had been furloughed due to the Covid-19 Pandemic and were now in receipt of PUP which amounted to €350 per week or less was such that it added to the stress levels of people who were already feeling vulnerable. People on PUP do not have the luxury of having their own accountants or tax advisors so they contacted Revenue by ringing or raising a query via My Enquiries on their Revenue MyAccount. No surprise that Revenue lines were jammed on 5th February when those people who had returned to work in January received their 1st wage slips showing 00 tax credits reduced standard rate cut off points and tax paid of 20% or greater on all their earnings. Many people who failed to get through to Revenue took to Social Media.

For the record it was not until Friday 5th February that BPPM started to look at the issue. In the absence of any Statement from Revenue or DSP it took two days over that weekend to get a handle on what was going on. On the 7th of February BPPM published a page on its website regarding the situation as it was known to BPPM at that time. Early on Monday morning 8th February BPPM sent the following email to local radio stations around the country:

"Subject: Tax on PUP in Real Time - What I Believe Will Be Big Breaking News

FAO:  Tommy Marron - Midwest Radio


23,137 PAYE workers returned to work in January 2021, after receiving the pandemic unemployment payment. What many if not all of them experienced last week, was zero tax credits huge reduction in their 20% band and astronomical income tax deductions. Revised Tax Credit Certificates have been issued by Revenue to PUP recipients reducing their tax credits for PUP they have not received. Why are Tax Credits Reduced for 2021?
Because from 1st January 2021 PUP payments earned in 2021 are taxable in real-time. This has never been done before and appears to be poorly thought through. It seems that there is some breakdown between Department of Employment Affairs and Social protection (DEASP) and Revenue.

Padraig Boyle
Boyle Practical Project Management

BPPM was contacted and asked to come on air with Midwest Radio presenter, Tommy Marren on Tuesday 9th February, to discuss this issue.

Midwest Radio Presenter Tommy Marren

Tax Credit Certs issued in Error Reversed by Revenue

BPPM learned on the evening of 9th February those PAYE workers that had been in contact with BPPM and had not earned any PUP in 2021 had updated revised Tax credit certs issued to them. These revised certs reversed the huge decreases in Tax Credits and 20% Tax Band (SRCOP) reductions already notified to them. Although no statement was issued by Revenue it was BPPM's understanding that Tax credit certs with reduced credits and SRCOP issued to everyone that had not earned any PUP in 2021, were issued an error. Following Revenue Update on Process for Taxation of the Pandemic Unemployment Payment (PUP) in 2021 issued on Thursday 11th February BPPM is convinced that recipients of PUP on Tuesday 5th January 2021 were issued with Tax Credit Certs reducing their credits and SRCOP in error, because PUP paid on this date was earned in 2020 and already included in their End of Year Revenue Statements.

In the following days after Tommy Marren broke this news on his morning Midwest Radio show the story about Revenue's Process for Taxation of the Pandemic Unemployment Payment (PUP) in 2021 was reported in almost every newspaper in the country. BPPM likes to think that the its email to local radio stations early on the morning of Monday the 8th of February and the airing of the issue on the Tommy Marren Show on Midwest RadioFM contributed to what must have been thousands of people, having their tax situation corrected. Remember that these were the people who received only 1 PUP in 2021, on the 5th of January. This payment related to the Tax year 2020 as this is when the PUP was earned. Reduced certs were issued to these in error. BPPM is of the opinion that this was only realised after they issued the 00 tax certs.

 Tax credit certs reducing credits for 2021 PUP

PAYE Workers Overtaxed in Error

The unfortunate result of this sorry saga is that ordinary PAYE workers have been treated very poorly regarding the lack of communication as to what continues to be a very stressful time for workers that have been made unemployed because of a Government decision to close the businesses in which they were employed due to the Covid-19 pandemic. BPPM is disappointed that the most vulnerable of PAYE workers were left with no information or no updates about this serious situation regarding their tax credit reductions and reductions to their SRCOP which was made in error. These PAYE who had no tax liability for 2021 in respect of PUP but yet they were deducted tax at 20% or greater on all wages payments they received between 5th and 12th February.

Overtaxed Workers Receive no Explanation Regarding Crippling Tax Deductions Made in Error

It must also be said that prior to the update on the Process for Taxation of the Pandemic Unemployment Payment (PUP) in 2021 made on 11th February neither Revenue or the Department of Social Protection (DSP) issued any statement whatsoever about the process for those that would be impacted when they would return to work apart from "From the 1st January 2021 PUP payments earned in 2021 are taxable in real time" BPPM is extremely disappointed with both Revenue and DSP who are generally excellent to keep the most vulnerable in out society up to date with issues that concern their finances. It is unfortunate that they also failed to inform the employers of these PAYE workers. BPPM has never failed to credit Revenue with the excellent work they do and for what they did at the beginning of this terrible pandemic, introducing and managing the TWSS in co-operation with employers and the manner in which they communicated updates to both employers and employees. What has happened over the past week is inconsistent with the quality of service delivered by Revenue over the past few years and particularly since the introduction of PAYE modernisation.

Process for Taxation of PUP in 2021

Youtube Video explaining How tha Process is Flawed. Please feel free to like share comment or follow.

Process for Taxation of PUP in 2021

Annualising Tax Credit and Band 1 Credit Reductions for PUP

Annualising_Tax_ Reductions_For_PUP

 

DSP Notifies Revenue of PUP of Weekly Amounts Paid

The Department of Social Protection notifies Revenue of Pandemic Unemployment Payment (PUP) amounts paid to recipients on or after 12th January 2021 i.e., earned in 2021. Revenue reduces the person’s tax credits and 20% standard rate cut-off point - SRCOP, by the weekly amount of PUP multiplied by 52. So, for example someone paid €350 per week PUP on or after 12th January 2021 will have their Tax credit reduced by €3,640 and SRCOP is reduced by €18,200 (350*52). €18,200 * 20% = €3,640. The adjusted tax credits and the 20% SRCOP are applied on a Week 1 / Month 1 basis. For those seeing a Band 1 Credit Reduction of 1700 means that Revenue is attempting to reduce their Tax Credits by €3,640 when they only gave them €3,300. It is like Revenue gave you 3 apples and are trying to take 5 back from you. The Band 1 Credit Reduction of 1700 is arrived at by multiplying 340 by 5.
As an aside a person who contacted BPPM thought they were getting a tax refund of €340. Notifications such as these, without any explanation or clarification issued by Revenue only contribute to more confusion among PAYE workers. 

Band 1 Credit Reduction

 

When the person returns to work, they must sign off the PUP on the 1st day they return to work through their MyWelfare Account. The process currently in place is ideal for the type of people that would try to take advantage of already stretched resources within the DSP by knowingly, not signing off the DUP after returning to employment. DSP will not be aware they have ceased PUP and these people will be taxed in excess of 20% on all of their income, and rightly so. Neither Revenue, DSP nor BPPM have any sympathy for whatever punitive actions are taken against such people.
 
DSP States: Do not claim the Covid-19 Pandemic Unemployment Payment if your employer has not laid you off or if you were not previously in employment or if you are still in receipt of employment income, or if your employer takes you back onto their payroll. “Any person who knowingly claims the payment in circumstances where they are not entitled to the payment will be prosecuted".

How to Close Pandemic Unemployment Payment

A worker can sign off the PUP with a basic MyGovID account.

How-to-Sign-off_the_PUP

DSP Cease Payment of PUP

The Dept. of Social Protection - DSP on receipt of this sign-off notification will cease the PUP payment.

DSP Notifies Revenue of Actual Paid in PUP

In the absence of any notifications posted on Revenue's website to date,15th February 2021, BPPM expects the Department of Social Protection to inform Revenue of the total amount of PUP earned in 2021 (i.e., paid to the recipient after 5th January 2021). The DSP will do this after the last payment of PUP has been made.

Revenue Update Corrected Tax Credit Certificate

When Revenue is notified that a PUP claim is closed, they will update the persons Tax Credit Certificate by reducing their Tax Credits and SRCOP by the actual amount that was earned in 2021. (paid out after 5th January 2021). Revenue will calculate the tax due based on the actual amount of PUP (not the full year annualised amount) and your tax credits will be updated to reflect the actual amount of tax due on the PUP.

Revenue Issue Revised Payroll Notification (RPN) to Employer

As with all changes to PAYE workers MyAccount on Revenue, the details are notified on the employee’s Tax Credit and Universal Social Charge Certificate (TCC) and a revised Revenue Payroll Notification (RPN) is sent to their employer for processing on their payroll.

Issue Relating to the Reduction of Tax Credits for Annualised PUP Rates

This is an ambitious process and could not have been done 3 years ago pre-PAYE modernisation. Boyle Practical Project Management believes that with advances in technology and in normal times under normal conditions that this process would work. However, we are not living in normal times and the conditions are far from normal.

There is a lot of credit due to those working at Revenue and DSP for the enormous effort they have put in over the past 10 months to deal with record numbers of people in receipt of TWSS and PUP. This time last year there was no such thing as TWSS, or PUP and credit is due to Revenue, DSP and employers for coming together to put a system in place in a short space of time to support Ireland's workforce.

That said BPPM is not confident that this ambitious process will work for the vast majority of PAYE workers who return to work and sign off the PUP on the day they return to work. BPPM’s fear (and this is not based on any supporting evidence) is that this process may have been put in place because of increased levels of people taking advantage of the fact that Resources are stretched within these departments by:

- not signing off the PUP when they take up employment

- claiming the Covid-19 Pandemic Unemployment Payment when their employer has not laid them off.

- claiming PUP and were not previously in employment.

- not informing DSP that they still in receipt of employment income.

-not informing DSP that they have been taken back onto the payroll by their employer.

As I mentioned earlier this process serves as a deterrent for such behaviour. However, if this happens to be the case, the majority of honest workers should not be penalized even if it is only in the short term by the actions of a few.

Delays in the Process Inevitable

On top of the normal workloads of Revenue and DSP this pandemic has increased activity levels within those Departments by enormous levels. BPPM is continuing in its unwavering support to PAYE workers during these difficult times as it believes PAYE workers have already become disadvantaged and soon many more will suffer the same fate due to what BPPM believes is an idealistic perception of taxing PUP in real time. BPPM is also not happy with this process in that "Where individuals are taxed under Joint assessment and the recipient of the PUP has insufficient tax credits for this reduction to apply, the spouse/civil partner’s tax credits will instead be reduced to ensure that the appropriate tax is collected".

In the event that there is any delay in updating their tax records, everything about this process is geared toward imposing the maximum amount of hardship on honest and hardworking people, when they return to work after been furloughed due to this pandemic.

Taxing PUP in Real Time is Idealistic

BPPM is continuing in its unwavering support to PAYE workers during these difficult times as it believes PAYE workers have already become disadvantaged and soon many more will suffer the same fate due to what BPPM believes is an idealistic perception of taxing PUP in real time.

BPPM Supports for PAYE Workers During Pandemic

As an outsource payroll provider BPPM has over the past 10 months been supporting PAYE workers in trying to come to grips with unprecedented changes to how payroll is processed. On this website there is a

Gross Pay to Net Pay Calculator.

This calculator has seen plenty of use during the early days of the TWSS as far back as last April when PAYE workers could determine how much tax and USC, they would owe at the end of the year on TWSS received. Tommy Marren at Midwest Radio was quick off the blocks as well at that time to advise his listeners of the fact that they would owe Tax and USC on these TWSS payments at the end of the year. This calculator was created in 2019 for PAYE workers to get answers themselves for questions like" if I got an extra €200 in overtime how much would it be worth into my hand?

Gross Pay to Net Pay Calculator

TWSS Rate Entitlement Calculator

BPPM created a calculator to enable PAYE workers calculate their exact TWSS rate entitlement independent from their employer's calculations, and also produced an accompanying video of how to use the calculator.

Temporary Wage Subsidy Scheme - TWSS Rate Calculator

Temporary Wage Subsidy Scheme Ready Reckoner

For those that need an estimate of TWSS rate entitlement BPPM troduced a Ready Reckoner

Temporary Wage Subsidy Scheme - TWSS Rate Ready Reckoner

End of Year 2020 Tax and USC Calculator

At the end of the 2020-year BPPM produced another simple calculator for PAYE workers to reconcile their revenue statements against the taxable income they actually received during the year.

End of Yaer PAYE  and USC Calculator

PAYE Tax Calculator 2021

Taxation of Pandemic Unemployment Payment Following a Return to Work after Receiving the PUP in 2021.This is a simple to use calculator for those issued with a Tax Cert on a Week 1/Month1 basis because they are on PUP, Maternity or Illness Benefit.

 

Conditions Not Ideal for Revenue Process

Unfortunately, conditions are not ideal for such an ambitious process, because workers within Revenue and DSP are still people, with the same fears and worries about contracting the virus as anyone else. I expect many of them have had to self-isolate because of been close contacts and I expect some of them have or have had the virus. Many of these workers maybe be working from home in conditions which may be less than ideal. The downside to this process for the vast majority of PAYE workers who return to work and sign off the PUP on the day they return to work is that they will be taxed in excess of 20% on all of their income if there is any delay in notifications between DSP and Revenue of the actual PUP earned in 2021. BPPM certainly hopes that such a situation does not arise as people returning to work after been on the PUP will already be financially stretched.

From statements issued by Revenue and from subsequent reports, radio interviews and newspaper reports, in the days after the Tommy Marron show on Midwest Radio. BPPM feels that there is a general consensus that it might take a couple of weeks after workers have returned to work to complete all the steps in this process. There seems to be a widely held view among traditional media that PAYE workers will be charged about an extra €7 per week for every week they were on the PUP at the €350 rate. The calculation of €7 per week is accurate for those that will be earning €350 per week on their return to work and BPPM would expect that PAYE workers would have no issues with it. The populist view seems to be that "In contrast to the year 2020, this process will mean that there will, in most cases, be no additional tax liability at the end of 2021.

PAYE workers don't have a couple of weeks to suffer 00 tax credits and reductions of up to €18,200 in their SRCOP. Taxes overpaid in this fashion will no doubt be refunded by Revenue but because there are no timelines issued in respect of this process and because both Revenue and DSP remain silent on the details, BPPM remains concerned about timing issues between the two agencies while PAYE workers suffer the consequences.


Differences in time lags between employers and the DSP in respect of when payment is earned compared to when they are made, make it impossible in all cases for this flawed process to work.

Over Taxation on Wages after Returning to Work

Youtube Video explaining the Overtaxation of Wages Because of the Flawed Process. Please feel free to like share comment or follow.

 

Over Taxation on Wages

Over Taxation on Wages after Returning to Work is inevitable because of the process and the differential timelines between the payment of wages and the payment of PUP.

Example of Revenue Process to Tax PUP in Real Time

For example, Paddy is a Category A Worker on €19.37 per hour and for 39 hours has a weekly taxable income of €755.43. Paddy was on PUP in the month of January. Paddy returned to work on Monday, 25th January, at which time he signed-off the PUP. He received his 1st payment of wages from his employer on Saturday, 5th February at which time he should be deducted tax on his wages together with outstanding tax due on his PUP payments (approx. €25). His last PUP payment would be made on Tuesday 2nd February.


Paddy was issued with this revised
Tax Credit Certificate effective from 4th February, but Paddy doesn’t understand a lot about payroll, so he did not bother too much with it. If a revised cert has not issued to Paddy's employer by the time, they run the payroll on Wednesday 5th February then Paddy will pay 20% or more tax on all his earnings. On his 1st pay-date Paddy paid €236.40 instead of €113.71, which represents an overpayment of €122.69.

tax credit certificate notification

For anyone else out there like Paddy that have not checked to see if their credits have been reduced, Boyle Practical Project Management would strongly recommend that they do so. For those that are currently out on PUP and would like to check to see if Revenue have already amended their Tax Credit Certificate they can do so as follows:

How to Check Tax Credit Certificate



1.          log into your Revenue Online Service (ROS)
2.          Sign in to “My Account”
3.          Enter your PPS No.
4.          Enter          Date of Birth
5.          Enter          Password
6.          Sign in       If you get a message about saving your passwaord I always say not for this site
7.          Go into      My Documents

 


When a revised Tax Credit Certificate is issued, the date of issue is highlighted here:

Revised Tax Cert Date of  Issue

On the main “myAccount” page there are 3 options displayed at the top of your screen. Click on “My Documents”

How to Revenue Tax Credit Certificate

A person can then view this document (View PDF) and if it is a case that their Tax Credits and Rate Band has been reduced, then BPPM recommend that they contact Revenue if they are about to return to work. They can do this through the “My Enquiries” function.  BPPM recommends that they check their details again in advance of their 1st wage payment to see if a revised tax credit certificate has been issued.

BPPM is urging anyone on the PUP currently and expecting to return to work in the next few weeks to watch the series of videos, made by Boyle Practical Project Management entitled "Taxation of Pandemic Unemployment Payment in 2021" and give them the thumbs up and leave a comment. These can be viewed on You Tube or Facebook.

Pandemic Unemployment Payment Schedule Dates

It is worth noting at this point that the last payment of PUP will be made to Paddy on Tuesday 2nd. The Pandemic Unemployment Payment is paid 5 days in arrears, with the earned week running from Friday to Thursday and payment made on the following Tuesday.

PUP Payment Schedule

Weekly Payroll Schedule

Paddy's employer’s week commences on a Monday and finishes on the following Sunday with payment for that period issuing on the following Saturday. That is 6 days after the period ends.

Pay Period Endings and Pay Dates

Remember Paddy did not bother checking his tax credit certificate notification. There was no change made to annualised deductions for PUP he only received for 4 weeks. Paddy ended paying tax of €242.94, which is €129 more than what he should have paid. The unfortunate thing is that he could be in the same situation the next time and the next time he is paid unless the credit reductions are reversed. The total amount Paddy owed for 4 weeks on PUP was €26.16. If this process is not changed this scenario will happen to everyone with Tax Credits reduced by annualised reductions to cover PUP. The process as it stands will most likely overtax those people paid on a weekly basis after returning to work.

Overtaxation of PUP

The populist view as reported in the traditional media was that Paddy should have paid an extra €5.38 per week until his total tax owing of €26 for his 4 weeks on PUP was cleared. When Paddy is issued with a cumulative cert reducing his credits to reflect 4 weeks on the PUP he will get any tax overpaid refunded. The question remains. How long does that take.

Why People Returning to Work are Overtaxed

BPPM's fears that in reality there is no chance, that PAYE workers who have received annualised reductions to their tax credits, will avoid paying 20% or more on all the earnings received on their 1st wages payment from their employer, following their return to work. The time lags between the Pandemic Unemployment Payment that is paid 5 days in arrears on the following Tuesday, with the payment week running from Friday to Thursday and "Our Sample Company" where wages payments are made 6 days in arrears, with the working week running from Monday to Sunday and payment made on Saturday.

Time lags prove there is no chance that weekly paid people returning to work will be taxed correctly. The reason is simple: They will not have received their last payment from DSP before they receive their 1st Payment from their employer. Revenue therefore will not have issued a correct Certificate for them. For Tax Certs to be implemented, employers must have been notified via Revenue Payroll Notification before they run their payroll.

BPPM Solution to End Over Taxation of Workers

What Boyle Practical Project Management in the You Tube video entitled Taxation of Pandemic Unemployment Payment Following a Return to Work after Receiving the Pandemic Unemployment Payment, Maternity and Ilness Benefits in 2021, recommends as the only solution for Revenue to collect Taxes owed on the PUP when these workers return to work:

1. Reverse all the annualised certs issued for those receiving Pandemic Unemployment Payment, Maternity and Ilness Benefits.

2. Replace them with their normal Credits and Standard Rate Cut Off point.

3. Issue the certificates on a wk1/mth1 basis.

4. When the persons receive their last payment of Pandemic Unemployment Payment, Maternity and Ilness benefits, DSP notify revenue of the amount of Pandemic Unemployment Payment, Maternity and Ilness benefits earned in 2021.

5. Revenue reduce Tax Credits and SRCOP to reflect actual Pandemic Unemployment Payment, Maternity and Ilness Benefits earned in 2021, and issue Tax Credit Certs on a wk1 basis.

Result: Tax due on PUP are recovered at the rate of approx. €7 per week for someone in receipt of €350 PUP per week, when workers return to work.

What all Workers with Reductions of Tax Credits for PUP Can Do

Anyone receiving the PUP at €350 would owe approx. €7 per week for the length of time they received the PUP in 2021 after 13th January. People are having tax of €200 and more taken out of their 1st wages more than what they should pay. This is happening because the process Revenue are using to recoup Tax on PUP earned in 2021 is inappropriate, flawed, and unworkable. If you want to put a stop to this, and prevent it happening to you or anyone else, you can take one or all the following actions now:

a) Watch the videos by Boyle Practical Project Management entitled Taxation of Pandemic Unemployment Payment in 2021, on You Tube or Facebook. While the picture quality could be better the content leaves no stone unturned in getting to the real impact of the flawed process been used by Revenue. By watching the three videos you will have a good understanding why this is happening and what you can do to stop it happening to you or anyone else again. The videos are 10 minutes long, but 10 minutes well spent if it resolves this serious issue.

b) Even if you do not watch all the videos, you can leave a comment on the You Tube video and if you were taxed excessively, say so.


c) Copy and paste the text in red and post it on any social media platform that you are on. This will help enormously to resolving this issue simply by spreading the news that there is a serious issue that is not been reported in the traditional media channels of newspapers, radio, and television. The hardship PAYE workers are experiencing on the ground due to this issue does not seem to be getting through to those that can change it.

OVER TAXATION OF WORKERS RETURNING TO WORK AFTER RECEIVING PANDEMIC UNEMPLOYMENT PAYMENT, MATERNITY, OR ILLNESS BENEFIT.
Anyone receiving the PUP at €350 would owe approx. €7 per week for the length of time they received the PUP in 2021, after 5th January. People are having tax of €200 and more taken out of their 1st wages more than what they should pay. This is happening because the process Revenue are using to recoup Tax on PUP earned in 2021 is inappropriate, flawed, and unworkable. If you want to put a stop to this, and prevent it happening to you or anyone else, you can take one or all the following actions now:


-read the rest of this post
-if you agree, follow these steps:
a) Watch the videos by Boyle Practical Project Management entitled Taxation of Pandemic Unemployment Payment in 2021, on You Tube or Facebook. While the picture quality could be better the content leaves no stone unturned in getting to the real impact of the flawed process been used by Revenue. By watching the three videos you will have a good understanding why this is happening and what you can do to stop it happening to you or anyone else again. The videos are 10 minutes long, but 10 minutes well spent if it resolves this serious issue.

b) Even if you do not watch all the videos, you can leave a comment on the You Tube or Facebook video, and if you were taxed excessively, say so.

-copy and paste this post (as it is) on your personal Facebook Page or any other platform (DO NOT SHARE). This will help enormously to resolving this issue simply by spreading the news that there is a serious issue that is not been reported in the traditional media channels of newspapers, radio, and television. The hardship PAYE workers are experiencing on the ground due to this issue does not seem to be getting through to those that can change it.

The correct
solution for Revenue to collect Taxes owed on the PUP when these workers return to work is:

1. Reverse all the annualised certs issued.

2. Replace them with their normal Credits and Standard Rate Cut Off point
.

3. Issue the certificates on a wk1/mth1 basis.

4. When a persons signs-off the PUP and receives their last payment, DSP notify revenue of the amount of PUP eMaternity and Illness benefit earned in 2021.

5. Revenue reduce Tax Credits and SRCOP to reflect actual PUP Maternity and Illness benefit earned in 2021.


Result: Taxes due on PUP, Maternity and Illness benefit are recovered at the rate of approx. €7 per week for someone in receipt of €350 PUP per week, when workers return to work.

 


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