COVID Relief Roundup
Posted: 17 September 2020
Since the pandemic arrived on our shores, the government has made available multiple types of financial relief; more than one may be available to your business. Although applications under the popular Wage Subsidy Scheme ended on 1 September 2020, other options are still available for support if you need it.
Apprentice Support Programme
If your business has an apprentice who is actually training, you may be eligible to receive $1,000/month for first year apprentices and $500/month for second year apprentices. This payment is for a maximum of 20 months from August 2020 to March 2022. Visit here at Work and Income Te Hiranga Tangata to apply.
COVID-19 Leave Support Scheme
What used to be called the Essential Workers Leave Support scheme has been renamed the COVID-19 Leave Support Scheme as it is now available to all eligible employers, not just essential businesses. An eligible employer with an employee who cannot work from home and is required to self-isolate due to COVID restrictions can, with the consent of their employee, apply for $585 per week for four weeks ($350/week for part-time employees). See here for more information.
COVID-19 Small Business Cashflow (Loan) Scheme
The Small Business Cashflow (Loan) Scheme (SBCS) is designed to help businesses through a low income period caused by COVID that, based on projections, will recover relatively quickly.
Eligible businesses include the self-employed as well as any small business with up to 50 employees that can directly attribute the need for the loan to COVID. Those eligible business may apply for up to $10,000 plus an additional $1,800 for each full time employee (or equivalent) who they employ.
The loan is interest free if it is repaid in full within one year; if not, an interest rate of 3% per annum applies. No repayments are required for the first two years, but the full amount must be repaid within five years of receipt of the loan.
Much like any other lender, the government must be satisfied that your business will remain viable and be able to service the loan over the next five years. To apply, or for more information, visit Inland Revenue here.
Temporary loss carry-back scheme
Many businesses will be familiar with carrying business losses forward to offset the tax payable on the following (hopefully) profitable year.
The temporary loss carry-back scheme allows the exact opposite to occur; a business can use its business losses experienced (or projected) during the 2019–2020 or 2020–2021 tax year against the prior year’s profits which will reduce the tax payable on profits already made. This adjustment is made through a provisional tax arrangement with Inland Revenue.
All businesses are eligible and consultation with your accountant is recommended to ensure this is appropriate for you. Apply via the ‘I want to’ link on your myIR.
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