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Covid 19:
Business Support Package
Update – 23/03/2020
This package was increased to include all businesses and to remove the $150,000 salary cap for any individual business.
What is it?
In the past few months, the world’s economy has been severely hurt by the outbreak of COVID-19. In many countries, businesses have been shut down by governments seeking to prevent the spread of this deadly disease. Sectors that have been particularly affected are tourism and hospitality but everyone feels the flow-on effects of forced isolation and reduced consumer confidence.
In an effort, to prop up the New Zealand economy the government has released the NZ Business Support Package. This is a $12.1bn relief package for New Zealanders. It is one of the largest packages in the world per capita.
The $12.1 billion package includes:
- Initial $500 million boosts for health
- $5.1 billion in wage subsidies for affected businesses in all sectors and regions, available from today
- $126 million in COVID-19 leave and self-isolation support
- $2.8 billion income support package for our most vulnerable, including a permanent $25 per week benefit increase and a doubling of the Winter Energy Payment for 2020
- $100 million redeployment package
- $2.8 billion in business tax changes to free up cash flow, including a provisional tax threshold lift, the reinstatement of building depreciation and writing off interest on the late payment of tax
- $600 million initial aviation support package
You can read more detail on the government website: https://www.beehive.govt.nz/release/121-billion-support-new-zealanders-and-business
Who qualifies for this package?
If you’re an employer, contractor, sole trader, or self-employed, you may qualify for the COVID-19 wage subsidy.
- your business must be registered and operating in New Zealand
- your employees must be legally working in New Zealand
the business must have experienced a minimum 30% decline in actual or predicted revenue over the period of a month when compared with the same month last year, and that decline is related to COVID-19 - your business must have taken active steps to mitigate the impact of COVID-19 (See how you can work towards this one below)
- you must make best efforts to retain employees and pay them a minimum of 80% of their normal income for the subsidised period.
For definitions of these qualifications, see the information under the Definitions for Wage Subsidy qualifications.
How much can you get?
The COVID-19 wage subsidy pays a flat rate of:
- $585.80 for people working 20 hours or more per week
- $350.00 for people working less than 20 hours per week
The subsidy is paid as a lump sum and covers 12 weeks per employee. It can be used for wages only. The aim is to help employers key their staff and ensure future viability of the business.
How do you apply?
You apply online for the wage subsidy or leave payment. You will need
- the IRD numbers of your business and the employees
- the business name and address and contact details
- the employee names and contact details
The Ministry of Social Development will be processing applications as quickly as possible. They are aiming to make payments 5 working days after the application is approved.
How can we help?
If there is anything we can do to help you or your business please let us know.
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- 027 569 9991
- hamish@hamishturner.co.nz
