Covid Restrictions Support Scheme ("CRSS")

As some businesses face into their third week of lockdown, Revenue have just released details on the operation of the Covid Restrictions Support Scheme (we'll call it CRSS from here on!)

CRSS has been introduced to assist businesses that have been significantly impacted by localised and national lockdowns

Successful applicants will receive cash payments from Revenue known as an Advance Credit for Trading Expenses (“ACTE”).

The scheme will operate from 13 October 2020 to 31 March 2021.

Who can apply for CRSS

- Companies

- Self-Employed Individuals

- Partnerships

Conditions to qualify for CRSS

- Must be trading in a location that where restrictions are imposed.

- The public are prohibited or significantly restricted from accessing your business premises. For the majority of businesses this means restrictions at Level 3 or higher. 

- Existing business - the income (excluding VAT) does not exceed 25% of an amount equal to the average weekly turnover of the business in 2019 multiplied by the number of weeks in the claim period.

- New business – the income (excluding VAT) does not exceed 25%% of an amount equal to the average weekly turnover of the business in 2020 multiplied by the number of weeks in the claim period.

- Tax Clearance Certificate is available.

- VAT obligations are up to date.

- You will resume trading once restricted are lifted.

Determining a Claim Period

Covid Restriction Period - A claim period will commence on the day the Covid restrictions are applied and will end when the Covid restrictions are due to end (based at the time the restrictions are introduced).

Covid Restriction Extended Period - If the restriction is extended this will constitute a new claim period from the date the restriction was due to end initially and will end on the date the extended period is due to end (based at the time the period is extended).

Example

On 13^th October Level 3 restriction in Dublin was set until 28^th October. Therefore 13^th – 28^th October is a Covid Restriction Period.

On 22^nd October further restrictions were implemented until which are due to end 1^st December. Therefore 29^th – 1^st December is a Covid Restriction Extended Period i.e. this is a new claim period.

ACTE Amount that can be Claimed

ACTE will be determined by the business’s prior turnover with a maximum weekly payment available capped at €5,000.

ACTE will be based on the turnover from 1 January 2019 to 31 December 2019:

- 10% average weekly turnover for 2019 up to €20,000

- 5% average weekly turnover for 2019 exceeding €20,000

*For new businesses established between 26 December 2019 to October 2020, ACTE will be based on turnover from date business commenced to 12 October 2020.

Example

Joe Bloggs turnover from his business in 2019 was €663,000 (exclusive of VAT). Assuming claim period is for 7 weeks.

- Average weekly turnover for 2019 - €663,000 / 52 = €12,750

- 10% of €12,750 = €1,275

- Multiplied by number of full weeks in claim period €1,275 x 7 = €8,925 ACTE

How is ACTE treated for tax purposes?

The ACTE payments receivable from Revenue must be reported in the tax return when preparing the taxable profit by reducing the amount of deductible expenditure.

How to Claim

The claim process is available on Revenue Online Services under the e-Repayments. This will be a 2-step process:

1) First register for CRSS on ROS, and

2) Complete a claim in respect of a claim period/s.

If you have a tax agent, they can access this using their agent ROS account.

If you have any queries you can visit Icon Accounting or email is at info@iconaccounting.ie and one of our members will be in touch in no time. We are one of the best Accountancy services in Dublin, Ireland.

Good try, But no you definitely can't claim that…

 Expenses – What you Can’t Claim as a Contractor (& some of the strangest requests we have had!)

Whether you are new to contracting or a seasoned contractor the topic of claimable expenses remains cloudy for many…

At Icon we have created videos & blogs covering general expenses and frequently requested topics like ‘home office expenses’ but we understand there are always more questions and always some remaining grey areas of what counts as a claimable business expense.

We have compiled the most frequent (an unusual) expenses queries we get at Icon Accounting of expenses you CANNOT claim. So, before you buy that golf membership or upgrade the kitchen table to serve as your new desk make sure you read this…

Holidays

Sorry your trip to sunnier climates does not count as an allowable business expense- though we wish it did too!

We have clients who try to claim holidays abroad, justifying it as a business trip,  in one case we had a client who tried to expense a trip to Maldives…justification was that he chose to go there with the other director in order to hold the AGM of the company….Co-incidentally himself and the other director only got married the week before… a curious coincidence !

Entertainment

A night out with your friends is not an allowable business expense. We had one former client who spent a large sum of money in a “gentlemans club” – apparently, he was trying to get his contract extended and brought the Project Manager on a night out

I hope he got a rate rise in next renewal; we definitely won’t be explaining that one to the Revenue auditor!

Golf

Golf clubs, Golf club membership, Golf trips. Golf is a common thread with our clients, unfortunately it’s not possible to claim this as a business expense. While it’s a great way to network & do business it’s difficult to justify the wholly, exclusively for business needs and necessary test with Revenue. So, you will have to work on the handicap outside of business hours on this one!

Home improvements

Whilst improvements to a home office can be deemed allowable in certain circumstances, the purchase of fridge/freezers, wine cooler and a €3,000 kitchen table would certainly not be allowed by our friends in Dublin Castle- yep people have asked us! though we do like the idea of a wine cooler in the office!

Children’s Gifts

We have had some strange requests over the years, particularly at Christmas, these include Kids bicycles, PlayStation, Lego, and dollhouses…

Tax tip for Xmas, do not buy I pads, children’s bikes under the bike to work scheme, a 2nd I-phone or jewellery for your partner. If it’s not for the business, it’s not an allowable expense believe us!

Valentine’s Day

 Every year we have client’s going on “business trips” around the 14th of February, usually for the weekend to a conference. This is a big NO NO as it is something Revenue always looks out for!

TV’s

A curved TV… back when they cost €2k and certainly did not make the cut when described as a 2nd monitor for the laptop…. hmmm

Pet Food

Pet food for the company “guard dog”... That happens to be a whippet. We’re afraid that Fido’s dinner will have to come from your pocket instead

Teeth Whitening

Yepee have been asked! While your teeth will look beautiful on zoom, I doubt the taxman cares much for your pearly whites

(Very) Personal Subscriptions

When we say ‘subscriptions’ can be expensed we are talking about your Zoom subscription or professional body annual membership fees. Plenty of Fish & Grindr don’t count sorry folks and make for awkward conversations with your account manager – trust us!

Stay tuned for new updates and we will back with all new features again shortly. Icon Accounting the best Accountancy firms in Ireland