In light of the recent change in alert levels, many businesses have found themselves in the all too familiar situation of not being able to trade or continue working to full capacity. Although this has put a lot of stress on business owners and staff, it is important to be aware of the financial support available.
The Government recently announced that should the country move from alert level 1 to level 2 for a week or more, businesses who show a decrease in revenue of at least 30 percent over a 14-day period as a result of the change in alert levels, will be able to apply for a one-off resurgence support payment. This payment will be a set $1500 per business, plus $400 per employee. The employee payment will however be capped at 50 employees. Businesses will also see the reinstatement of the wage subsidy, which will follow the same criteria as the last Auckland lockdown.
In an attempt to encourage staff to stay home and isolate while awaiting the results of a Covid-19 test, Government will offer a one-off, short-term absence payment. This is available for employers whose staff cannot work from home while awaiting test results.
The payment will be $350 for each employee who requires it, but it is capped to one application per 30-day period.
It is important to note that there are tax implications involved with the subsidies. We recommend that you consult your tax advisors regarding the treatment of these.
A reminder that the small business cashflow scheme is still available, regardless of the changes in alert levels. The loan application period has been extended and businesses now have until December 31, 2023 to apply. The loan can be taken over a five-year period at an interest rate of three percent, however there will be no interest charged if the loan is paid off within two years. The maximum loan amount is $10,000 plus $1800 per full time employee. Businesses that have paid the loan off prior to December 31, 2023 have the option to re-borrow if they meet the criteria.