The CRSS, announced in last month’s Budget for 2021 by Minister for Finance Paschal Donohoe, aims to assist businesses whose trade have been significantly impacted as a result of government restrictions.
The Department of Finance announced through a press release that eligible businesses can now register for the scheme through the Revenue Online Service(ROS).
While the funds are available from mid-November, the CRSS came into effect from the announcement of the government budget on the 13th of October. That means your claim can be submitted in the coming weeks to cover the period to date.
Minister Paschal Donohoe said that he was “confident” that the CRSS will provide much needed support to businesses that have had to close as a result of the restrictions.
Minister Donohoe stated that when registration opened, Revenue informed him that nearly 4000 businesses had registered almost 4,160 premises for CRSS with Revenue.
For detailed guidance on how the CRSS will operate based on the proposed legislation, including how to register for the scheme, click here
The CRSS will operate from the 13th of October 2020 to March 31st 2021 with a provision for the Minister for Finance to vary aspects of the scheme by Ministerial order.
What you need to know about CRSS
Businesses who apply for the scheme must be able to “demonstrate” the impact of COVID-19 restrictions on their business. The impact must show “significantly” affected turnover rates for the business in the period for which the restrictions are in operation.
If a business makes a claim, the government will provide up to 25% of an amount equal to the average weekly turnover of the business in 2019 (or average weekly turnover in 2020 in the case of a new business) multiplied by the number of weeks in the period for which the claim is made.
Businesses who qualify will be able to make a claim to Revenue under the CRSS for a cash payment to be known as an “Advance Credit for Trading Expenses.” The payment will be equal to 10% of their average weekly turnover in 2019 up to €20,000 and 5% thereafter, subject to a maximum weekly payment of €5000, for each week that their business is affected by the COVID-19 restrictions.
For New Businesses
If a business was established between December 26th 2019 and the 12 of October 2020, the claim will be based on their actual weekly average turnover in the period between the date of commencement and the 12th of October 2020 (subject to the weekly cap of €5000). Payments made under the scheme will be treated as an advance credit for trading expenses.
Applying for CRSS
Through a press release, the Department of Finance stated that the registration process will include providing details such as the location of the business and the average weekly turnover for 2019. Business who apply for CRSS is now are expected to receive their first payment half-way through December.
On the announcement of the 2021 Budget, Tánaiste and Business Minister, Leo Varadkar, said those who meet the criteria for CRSS are “urged” to contact the Revenue Commissioners as soon as possible. Tánaiste Varadkar also indicated that the CRSS will be based on a self-assessment basis, but stated there “will be audits.”
The CRSS is a targeted support scheme for businesses significantly impacted by the restrictions introduced by the government, under public health regulations, to combat the effects of the COVID-19 pandemic.
Published in the Finance Bill, the key features of the scheme are:
- The CRSS is designed to assist businesses whose trade has been significantly implicated or temporarily closed as a result of the restrictions as set out in the government’s Living with COVID-19’ Plan.
- The scheme will generally operate when Level 3 or higher is in place and will cease when restrictions are lifted.
- CRSS will apply for businesses where government restrictions prohibit or reduce access by customers to their business premises.
- Qualifying businesses can now apply to the Revenue Commissioners for a cash payment in respect of an advance credit for trading expenses for the period of the restrictions.
- To qualify for the scheme, a business must be able to demonstrate that, because of the COVID-19 restrictions, the turnover of the business in the period for which the restrictions are in operation, and for which a claim is made, will be no more than 25% of an amount equal to the average weekly turnover of the business in 2019 (or average weekly turnover in 2020 in the case of a new business) multiplied by the number of weeks in the period for which a claim is made
- The scheme will operate from 13th of October 2020 to 31st March 2021, and there is provision for the Minister for Finance to vary aspects of the scheme by Ministerial Order
Revenue has published an overview of the scheme with some detailed examples, together with guidance on the operation of the scheme on Revenue.ie
Qualification criteria (please see Revenue.ie for full details)
To qualify for the scheme, businesses will need to:
- Be a self-employed individual or companies who carry on a trade or trading activities, the profits from which are chargeable to tax under Case I of Schedule D. It is also available to persons who carry on a trade in partnership
- Operating business premises located wholly within a geographical region for which COVID-19 restrictions are in operation, and that premises has, due to the significant COVID-19 restrictions, has either temporarily closed to customers or is substantially restricted in operating
- as a result of these significant restrictions, is operating at less than 25% of turnover in 2019
- have an up to date tax clearance certificate
- have complied with their Value-Added Tax obligations
- intend resuming trading when restrictions are lifted
- register for the scheme on the ‘Revenue Online Service’ and make a declaration that they satisfy the conditions to make a claim
Operation of the scheme
Qualifying businesses will be able to make a claim to Revenue under the CRSS for a cash payment, which will be known as an “Advance Credit for Trading Expenses” (“ACTE”). The ACTE will provide an immediate cash support for businesses. The amount of the ACTE will be based on an amount equal to 10% of the average weekly turnover of the business in 2019 (or in the case of new businesses, the average weekly turnover in 2020) up to €20,000 and 5% thereafter, subject to a maximum weekly payment of €5,000.
All eligible businesses can claim the support irrespective of their turnover levels, but the amount of the ACTE cannot exceed the lower of the amount based on 10%/5% of the relevant weekly turnover or €5,000 per week.
Where COVID-19 restrictions for a geographical region are extended beyond the date on which they were due to expire, a new claim is required for each extension period.
How to make a claim
If your business is eligible for the CRSS scheme, you must claim it through Revenue Online (ROS) for an ACTE.
If you are going to apply, first you need to
- Register for CRSS on ROS
- Complete a claim in respect of a claim period or periods.
Step 1 Registration:
It is more than likely that you have ROS online, but if you don’t, you must register for it now to avail of the claim.
In the case of a partnership, registration can only be made by the precedent partner, on behalf of the partnership. The precedent partner will register under the tax reference number of the partnership trade.
When you are registering for the CRSS, you will be required to provide details on the location you are signing up to the claim if there is more than one, each of your business.
You will need the following information when signing up for the CRSS:
- Business/ Premises Name (required for each business premises in which a relevant business activity is carried on and for which a claim will be made),
- Address, including the Eircode for the business. Each one of your premises will need to have the address and Eircode inputted where a relevant business activity is carried on and for which claim will be made),
- Business Sector
- If the registration is being made by a precedent partner on behalf of a partnership, the partnership number,
- Average weekly turnover in respect of 2019 (required for each business premises in which a relevant business activity is carried on and for which a claim will be made) for a business established before the 26th of December 2019
- Average weekly turnover for 2020 (required for each business premises in which a relevant business activity is carried on and for which a claim will be made) for businesses established on or after the 26th of December 2019 and before the 13th of October 2020,
- Date of commencement for new business,
- VAT in respect of T1 on VAT 3 (i.e. VAT on outputs)
- Other income in respect of which VAT was charged.
For a comprehensive PDF on the CRSS, click here
Step 2: Claiming CRSS
A claim portal in respect of CRSS will be available via the eRepayments system on ROS from mid-November. It is important to note that the CRSS ‘Tax Head’ will only be visible to those persons who have successfully completed the CRSS eRegistration process.
Qualifying persons can claim for each claim period in which they meet the eligibility criteria, and a new claim should be made for each claim period. Before any further claim, taxpayers should review the eligibility criteria in Section 4 and ensure they meet all conditions before making a claim for each claim period.
The following information will be required at the claim stage:
- Business Premises (in which relevant business activity is carried) in respect of which a claim is made,
- Claim period start week,
- Claim period end week
For a comprehensive PDF on the CRSS, click here