Government Business Continuity Package:
The Government has released a significant economic package week and subsidies are now available for all businesses significantly impacted by COVID-19 including:
- employers that are struggling to retain employees
- sole traders
- new and existing businesses.
These subsidies are available for businesses that can show a 30% decline in revenue for any month between January and June 2020 compared to the year before (including projected revenue).
The subsidy are:
- $585.80 per week for a full-time employee (20 hrs or more)
- $350.00 per week for a part-time employee (less than 20 hrs).
The payment will be made as a lump sum for a period covering 12 weeks.
You can apply for the package now - you do not need any supporting information to apply, however, you are signing a legal declaration and will be required to supply supporting information at some stage.
The scheme is operating on "high trust" - that is the Government is trying to ensure people receive the assistance they need quickly and that they are relying on the honesty of those making applications. There will be penalties for those who abuse the system.
For further information and to apply for the subsidy - click here
Definitions of the requirements can be found here: https://www.workandincome.govt.nz/products/a-z-benefits/covid-19-support.html#null
There is some basic information you can start to collect now to help support your application:
- proof that your business has declined by 30% - this may include cancellation notifications; bank records and financial accounts. We understand that audited financial statements are not required;
- proof that you are mitigating the impact of Covid-19 - this may include offering longer term accommodation, increasing your advertising on OTAs, offering room for quarantine (if suitable and practicable, containing any business advisors you may deal with, discussions with your accountant and discussions with your bank manager.
What happens when the subsidy is no longer available?
The Government’s economic response package was designed to support businesses through the immediate impact of COVID-19, specifically over the next three months. Members should consider how best to operate once the subsidy if the subsidy is not extended and once it becomes unavailable.
What does a 30% decline in revenue mean?
This means a business has experienced a 30% decline in:
- actual revenue, or
- predicted revenue (e.g. for businesses who have seen a reduction in bookings such as accommodation providers), and
- that decline is related to COVID-19.
The business must experience this decline between January 2020 and 9 June 2020. Applications can also be made on the basis of forecast revenue loss within the period of the scheme.
Definition of revenue
Revenue means the total amount of money a business has earned from its normal business activities, before expenses are deducted.
Determining a decline in revenue
To determine a decline in revenue, the business must compare one month’s revenue against the same month the previous year (e.g. February 2020 compared with February 2019). The revenue of the month in the affected period must be at least 30% less than it was in the month it was compared against.
Businesses operating for less than a year
Where a business has been operating for less than a year, they must compare their revenue against a previous month that gives the best estimation of the revenue decline related to COVID-19.
What are active steps to mitigate the impact of COVID-19?
A business must take active steps to mitigate the financial impact of COVID-19 on their business. This could include activating their business continuity plan and seeking advice and support from:
- their bank;
- the Chamber of Commerce;
- a relevant industry association;
- the Regional Business Partner programme.
TIA created this wage subsidy FAQ -
If you haven't already applied - you should!
If you have applied and don't hear back in 5 working days then you can contact:
Please ensure you add a comment about your application for the business continuity subsidy so she can pioritise her emails!
And don't forget to include your IRD number and name so they can look for the application!!
Or you can call - 0800 40 80 40.
Mortgage Holiday and Business Finance Support Schemes
24 March 2020
The Government, retail banks and the Reserve Bank have announced a major financial support package for home owners and businesses affected by the economic impacts of COVID-19.
To see more - click here
The package includes a six month principal and interest payment holiday for mortgage holders and SME customers whose incomes have been affected by the economic disruption from COVID-19.
If owners would like to take advantage of these scheme - they should contact their bank .