Galway workers on PUP scheme set to face tax bill of more than €1,000

Minister Paschal Donohue says debut can be paid off over a number of years; PBP Galway say debt is being paid by those 'most in need of help'

Workers made unemployed by the impact of Covid-19, and the lockdowns, enter 2021 facing tax liabilities on the welfare which sustained their livelihoods throughout last year.

This month, Revenue will issue a Preliminary End of Year Statement to those in receipt of either the Pandemic Unemployment Payment or the Temporary Wage Subsidy Scheme, outlining the tax they owe and the methods through which they can pay it back.

PBP Galway has criticised the move saying workers "should not shoulder a cost which could exceed €1,000 in some cases" for having been unable to work due to extreme external mitigating factors, "namely, a global pandemic that has brought many countries to their knees".

'Supports are essential'

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"The supports are essential," said PBP Galway spokesperson, Shane O’Connell. "Yet the debt incurred must be partially repaid by the recipients who were in the most need of help.”

In the last week of December, the CSO said 335,599 people were in receipt of the PUP, but that decreased by 43,997 for the week ending January 3. The CSO said the fluctuation of recent weeks was mainly due to the changes in the restrictions, and further changes in the coming weeks can be expected.

A total of 785,687 people have received at least one PUP payment since the scheme was established last March, of which 55 per cent are male and 47 per cent are aged between 25 and 44.

Tax bill in January

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The statement from Revenue will detail any income received and reported by an individual's employer or employers; information on the amount of PUP received; a preliminary calculation of a citizen's IT and USC for 2020; whether a person's tax position is balanced, underpaid, or overpaid for the year.

Those who owe tax can either fully or partially pay through the 'Payments/Repayments' facility in the Revenue's online myAccount. Alternatively Revenue will collect the full or any remaining liability, interest free, by reducing a person's tax credits between 2022 and 2025.

The Minister for Finance, Paschal Donohoe, speaking on Newstalk, acknowledged that 2020 "has been a very, very difficult year for so many" and pointed out that the tax owed can be paid off over a number of years. "This should hopefully allow this matter to be dealt with in a way that is careful and fair for all," he said.

'No compassion'

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PBP Galway, however, said this "business as usual" approach to taking unemployed workers, during unprecedented events such as Covid-19, smacks of "blind indifference".

"As citizens impacted by COVID-19-related unemployment face another gruelling year of lockdowns, they must also brace for tax liabilities on the welfare support they have claimed," said PBP Galway's Shane O’Connell, who noted that the tax must be paid, "regardless of the economic or social circumstances you find yourself in".

“Workers availing of PUP payments did so as their work was not possible due to a global pandemic," he said. "They should not shoulder a cost which could exceed €1,000 in some cases to their further economic detriment through receipt of an essential service. As we have seen time and time again however, compassion is not on the programme for government.”

 

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