Small and medium businesses are the backbone of our domestic economy and they support thousands of jobs.
Today, Minister Donohoe announced that a new scheme to help such businesses pay for increasing energy costs will be launched. Full details of the new Temporary Business Energy Support Scheme (TBESS) are yet to be published but what we understand from the Minister’s speech is that it will pay for 40 percent of the increase in gas and electricity that small and medium businesses are facing.
The details of the scheme outlined by the Minister today are set out below and once more details are published we will update members via Chartered Accountants Tax News.
- The scheme will be open to businesses that carry on a Case 1 trade, are tax compliant and have experienced a significant increase (more than 50 percent) in their natural gas and electricity costs;
- It will be administered by the Revenue Commissioners and will operate on a self-assessment basis;
- The scheme will operate by comparing the average unit price for the relevant bill period in 2022 with the average unit price in the corresponding reference period in 2021;
- In order to be eligible for the scheme, the average unit price must have increased by more than 50 percent;
- Claims will be able to be made by businesses for up to 40 percent of the amount of the increase in the bill, capped at €10,000 per month per trade;
- An overall cap will apply on the total amount which a business can claim.
- According to the Department of Enterprise Trade and Employment payments will be backdated to September 2022 and will run until at least February 2023 and will cost €1.25 billion.
The scheme is being designed to be compliant with the EU State Aid Temporary Crisis Framework and will require approval by the EU Commission in the advance of making payments.