The latest figures from the Central Statistics Office (CSO) show that almost 480,000 people in Ireland remain in receipt of the Pandemic Unemployment Payment (PUP) with many facing further months of unemployment amid extended level 5 restrictions.
The Irish government recently revealed they would be implementing a new scheme as the PUP comes to an eventual end.
If you’re unsure of what this change will mean, what extra benefits are available, or if you’re returning to work and want to know how you’ll be paying the money back, then look no further!
PUP Interim Scheme
As talks are underway for an extension of the PUP until summer 2021, it was revealed that an interim scheme will likely be introduced for those who remain unemployed.
It is understood that the new payments will be linked to people’s past working history with a proposal setting forth plans for those who were in long-term employment to receive a higher monthly amount.
This would be offered for a number of weeks after the PUP ends, at a percentage of their previous salary, but after a period of time, they would be placed back on the standard payment.
Paying back PUP
If you’re returning to a job, after being on the PUP, the Revenue has said they will deduct the tax owed per person as soon as you return to work “to ensure there is no big tax bill at the end of the year”.
This will be done by the Revenue deducting a percentage of what you owe from each payslip.
Speaking about the impending charges, Marian Ryan from taxback.com said this should be “seen as a somewhat beneficial development for recipients of the PUP in 2021, as it means that they will not face a big tax bill next January.”
However, “anyone who received the PUP in 2020 will still be able to spread any tax liability arising for that year over the following 4 years, as previously stated by Revenue,” Marian confirmed.
The new proposed way of getting people to pay a certain amount back a month will prevent them from “reduced tax credits in future tax years.”
“As it stands, PUP payments remain a taxable income, but rather than allow underpayments to accumulate for the year, which would then need to be clawed back in the future tax years, all tax due for 2021 should now be collected over the course of the current tax year for any recipients who return to the workforce”.
PUP and other social welfare payments:
Prior to COVID-19, if you were working and getting a social welfare payment, you can keep your social welfare payment at its current rate and claim the COVID-19 PUP.
This allows for those in receipt of a carer’s payment, disability allowance, working/ one-parent family payment, or jobseeker's transitional payments to remain in receipt of these alongside the COVID-19 PUP.
Back to Education Allowance and PUP
If you’re heading back to education, and are on the PUP, you can still apply for the Back to Education Allowance, if you’re entering your first year of a course.
PUP and Maternity Benefit
If you are pregnant and your employer has no work available and therefore can't pay you, you can apply for the COVID-19 PUP.
This applies both when your due date is within 16 weeks and if it is more than 16 weeks from the last day of your employment.
However, if you’re still getting a COVID-19 PUP when you are due to begin your maternity leave, you need to close your claim and claim Maternity Benefit.
