SINGAPORE - More than 140,000 employers of local workers started receiving the first Jobs Support Scheme payout from Wednesday (April 15).
The scheme will pay out 75 per cent of wages for April and May on the first $4,600 of a worker's gross monthly pay, and at least 25 per cent for a further seven months, depending on the sector.
Firms in the food services industry will receive 50 per cent of wages for those seven months while aviation and tourism sector companies will get 75 per cent of wages for the full nine months.
The wage subsidies were first announced in February's Budget and then later enhanced.
Here are seven things to know about the payouts:
1. There is no need to apply
All employers who have made contributions to the Central Provident Fund (CPF) for local staff - Singaporeans and permanent residents - qualify, apart from some on an exclusion list such as local government agencies, embassies or representative offices of foreign companies.
Eligible companies will be notified of the subsidy tier they qualify for and the amount they will receive.
Those with CorpPass access can log in to the myTax Portal to view their notification letters from Monday (April 20).
Employers using Giro or PayNow Corporate for transactions with the Inland Revenue Authority of Singapore (Iras) will get their payouts faster. The first tranche was directly credited on Wednesday (April 15) to the GIRO bank account employers use for income or goods and services taxes.
Other had it credited to the bank account they have registered with PayNow Corporate.
Companies not on either scheme will start receiving cheques from April 23.
2. Subsequent payouts will be adjusted down if employers cut wages now
The first payout this month is calculated based on wages paid in October, November and December last year.
The higher support of 75 per cent for April wages is to help firms cope with the "circuit breaker" measures that have forced non-essential businesses to close their workplaces. It was calculated based on October 2019 wages first so that the money can be paid out faster.
Any difference between a worker's wages in October 2019 and April 2020 will be factored into the second and third payouts.
For example, if a worker was put on no-pay leave in April, the extra payout credited to his employer in the first tranche will be subtracted from subsequent tranches, where possible. If the payout for a single worker cannot cover the extra amount that needs to be subtracted, the amount will be subtracted from the overall payout for all workers under the employer.
The July payout will be based on wages paid in February, March and April this year while the October payout will be based on wages paid in May, June and July this year.
On Tuesday (April 21), Deputy Prime Minister Heng Swee Keat announced that the Government will extend the higher wage support of 75 per cent for all businesses into May, instead of just April. This is to tide firms and workers over the extended “circuit breaker” measures, which now last until June 1, instead of May 4.
A new Jobs Support Scheme payout will be made in May, based on wages paid in November last year. Any difference between a workers’ wages in those two months will be factored into the last payout, in October this year.
3. Workers earning more than $4,600 are still covered
The subsidy applies to the first $4,600 of gross monthly wages. If a worker earns more than $4,600, his employer gets 75 per cent of $4,600, or $3,450, for April's wages.
Gross monthly wages include employee CPF contributions, but exclude employer CPF contributions.
4. The payouts cover wages of employees only
They do not cover the wages of business owners, such as sole proprietors.
This is because the scheme is meant to help companies retain local staff during the pandemic.
Self-employed people who are eligible for the recently announced Self-Employed Person Income Relief Scheme can receive three quarterly cash payouts of $3,000 in May, July and October this year.
The Jobs Support Scheme also applies to contract workers, not just permanent staff.
Under enhancements to the scheme announced on Tuesday (April 21), employees who are shareholders and directors of a company will also be covered if they had an assessable income of up to $100,000 last year. They were previously excluded as they were considered business owners.
Thus, the May payout will include back-payment for companies with qualifying shareholder-directors whose wages were excluded in the April payout.
5. The payouts go to employers, not workers themselves
They are meant to help employers continue to pay local workers' salaries and employer CPF contributions during this period, when revenues have likely been hit.
CPF contribution rates for employers and employees have not been changed.
6. Employers can check eligibility for the higher tiers of support online
Aviation and tourism businesses qualify for 75 per cent wage support throughout the nine months of the scheme. They include airlines, airport ground handlers, travel agents, gated tourist attractions, hotels and operators of meetings, incentives, conferences and exhibitions venues.
Food services businesses qualify for 75 per cent wage support in April and 50 per cent support for eight months. These are licensed food shops and stalls, including hawker stalls.
There is a Jobs Support Scheme Employer Eligibility form which lets you check if you are eligible for the higher wage subsidies. Access it at the Iras website. You can also call 1800 352 4728 during office hours (between 8am to 5pm, on Mondays to Fridays).
There is also an appeal form available on the same website. Appeals will be considered on a case-by-case basis.
7. Enquiries can be made to the Iras
You can contact the taxman for more information on the scheme via the online form or 1800 352 4728.