We sent an email last week to provide information regarding some of the initiatives the government has announced to help businesses survive and begin to recover from the effects of the COVID-19 crisis. Since then some some of the details have been changed, and this is a short note to ensure you are up to date.

Wages subsidy extensio

The wages subsidy (introduced at the beginning of the COVID-19 lockdown) closed on 9th June.  The wages subsidy extension commenced on 10th June.  You can find out details about the scheme and a link to the online application form at https://www.workandincome.govt.nz/covid-19/wage-subsidy-extension/how-to-apply.html.  The scheme extends the subsidy for a further 8 weeks on top of the original 12 weeks. 

  • You can apply for the wage subsidy extension even if you didn’t apply for the original wage subsidy,
  • If you did apply for the original wage subsidy, you cannot apply for the extension until 12 weeks after the application for the first subsidy.
  • Your business must have experienced a minimum 40% decline in revenue for a continuous 30 day period. This period needs to be in the 40 days before you apply (but no earlier than 10 May 2020) and must be compared to the closest period last year.
  • The 40% decline must be related to COVID-19.
  • New businesses which have been operating less than a year, or businesses that have had a significant increase in revenue, can apply for the wages subsidy extension by comparing their revenue against a previous month, or 30 days, that gives the best estimation of the revenue decline related to COVID-19.
  • Your business must have taken active steps to mitigate the financial impact of COVID-19
  • You must retain the employees named in your application for the period of the Wage Subsidy Extension.

Small business cash flow (loan) scheme

The closing date for this scheme has now been extended until 24th July 2020.  In order to qualify for this loan (which is $10,000 + $1,800 per employee (including working owners) you must have received the wage subsidy and the value of your loan will be based on the information you provided in the wage subsidy application. Applications can only be made by the business owner logging into MyIR on the IR website (https://www.ird.govt.nz/)..

If you have missed our previous emails, you can find them on our website at http://hounsell.co.nz/news-and-views/.  If you need further help, please contact us.

Disclaimer

The material on this website is for the benefit and information of clients. The items are in the nature of general comments only, and are not to be used, relied or acted upon without seeking further professional advice. Hounsell Accounting Limited accepts no liability for any errors or omissions, or for any loss or damage suffered as a result of any person acting without such advice

Written by Don Hounsell