Almost 300,000 workers face paying up to €2,500 each in back tax from January because they received PUP and other payments during the pandemic.
Accountants are being contacted by “terrified” workers who didn’t know they were liable for this tax but have been notified by Revenue in the past two weeks.
If they don’t come up with a plan to repay the back tax it could begin to be deducted from their salary from the start of the New Year.
It has emerged that almost 280,000 people have yet to contact the Revenue to organise a payment plan for their tax due.
If they fail to do this they will face an automatic tax credit reduction.
But many workers don’t know how to use Revenue’s ROS (Revenue Online Service) system and are contacting accountants for help.
One accountant, who wanted to remain anonymous to protect her clients, claimed the clawback of tax is totally unfair as it hits the very workers who kept the country going during the pandemic.
She said: “This is effectively a pay cut for all private workers who worked through the pandemic at risk to themselves and their families.
“This scheme was implemented without informing the employees of the possible consequences.
“Bearing in mind that employers in the private sector received substantial hand-outs from the State and their PRSI was reduced from 11.05% to 0.5% for two years, this is immoral. The public sector has not been affected at all by this. But the supermarket workers who sold them their lunches while they were all working from home are affected. Why is that fair?”
Those who were in receipt of the PUP or TWSS schemes during lockdowns were given the option to pay back their income tax bill over four years – but they had to file a tax return in order to clear the charge.
Revenue confirmed that the number of those left to contact them is close to 300,000 in relation to the PUP and the Temporary Wage Subsidy Scheme payments.
Another accountant added: “It’s very unusual to see PAYE workers contacting accountants but they are, it’s usually the self-employed at this time of year.
“Don’t blame Revenue, it’s the Government’s fault for coming up with these badly thought-out schemes which penalise the very workers who kept the country going during Covid.
“My advice to PAYE workers who are worried about their tax liabilities is to go to the Citizens Advice people and ask for help.”
- Citizens Information Phone Service can be contacted on 0818 07 4000
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