Revenue eBrief No. 110/22
17 May 2022
Tax treatment of the Pandemic Special Recognition Payment to frontline healthcare workers
The Government announced a COVID-19 recognition payment for eligible frontline healthcare workers, to recognise their unique role during the pandemic. The Government committed that the Pandemic Special Recognition Payment made to the specified categories of frontline healthcare workers of up to a maximum of €1,000 per individual will not be subject to income tax, USC, or PRSI. This eBrief outlines the tax treatment of payments under the Government scheme.
Frontline healthcare workers (including agency staff working for the HSE) must have been employed between 1st of March 2020 and 30th of June 2021 and have been identified as working in COVID-19 exposed healthcare environments. For part-time eligible workers, the payment will be pro-rated. Employees who worked less than 4 weeks in the specified period do not qualify.
Others eligible for the payment will include staff in private sector nursing homes and hospices that were affected by COVID-19; and staff working on-site in long-term residential care facilities for people with disabilities (including where such facilities are operated by 'Section 39' voluntary organisations).
Any payment under the Government’s Pandemic Special Recognition Payment scheme is exempt from income tax, USC and PRSI. The exemption applies to a maximum of €1,000 per qualifying individual and only applies to payments made under the scheme.
As it is the clear intention of Government that the payment is exempt from income tax, USC and PRSI, employers and payroll operators making Pandemic Special Recognition Payments to qualifying individuals may make such payments free of tax, USC and PRSI, pending enactment of the Finance (Covid-19 and Miscellaneous Provisions) Bill 2022.