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

On 22nd October further restrictions were implemented until which are due to end 1st December. Therefore 29th – 1st 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.

Author

Cristina Rogojina

Tax

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