The Minister for Finance Paschal Donohoe has announced that the wage subsidy scheme will now be available until March next year.
The new scheme is being introduced now, due to fears of economic harm to companies next month, before Brexit.
The scheme is being revamped next week, making it easier for employers who have been impacted by the pandemic to access.
It will also see income tax, USC and PRSI being taken from source.
Speaking of RTÉ's Morning Ireland, Mr Donohoe says the scheme will also be open to more people, with 69,000 people availing of the support to date.
"The scheme that's coming in the next week will be open to more people to apply. We are going to extend it up to the end of next March so it will be in place for longer.
"It's also going to be simpler. There will be a flat rate subsidy, two different levels available to any worker who is on this scheme."
According to data from Revenue published on Thursday, 240,700 people claimed the wage subsidy last week, costing €126 million.
Revenue estimates that 365,000 people are currently being directly supported by the scheme.
Mr Donohoe also said the current economic climate means the upcoming budget is crucial.
"It is fair to say that rarely has a budget been prepared in a situation of such uncertainty as Budget 2021 is going to be developed in.
"This is the very reason why we need to have a good budget for next year."