Covid Subsidy 20th Aug 2021
Applications are now open for the latest round of the wage subsidy. Many aspects of the wage subsidy remain the same as previous schemes, but the context in which applications may be made is different.
COVID-19 Financial Support Tool
Financial support for businesses | Unite against COVID-19 (covid19.govt.nz)
You can use the COVID-19 financial support tool to find out what financial help may be available to you.
The tool will take you, step by step, through a series of questions to understand your personal circumstances such as:
· your work status, for example, employer
· your situation, for example your business is unable to operate
· if your workplace has reduced business and revenue.
The tool will then tell you what financial help and support you can access, and where you can apply or find more information.
COVID-19 Wage Subsidy August 2021
This information is a guide only. The Wage Subsidy declaration on the Work and Income website has full details of eligibility criteria and obligations, and prevails over any other information.
The COVID-19 Wage Subsidy 2021 is open for applications for two weeks from 9.00am, Friday 20 August 2021.
Applications can be made through the Work and Income website, https://www.workandincome.govt.nz/covid-19/wage-subsidy/index.html
The subsidy is for two weeks, and the payment rate is $600 a week (full time) and $359.00 a week (part-time).
To ensure applications get processed as quickly as possible, it’s important the information provided matches what is held by Inland Revenue (e.g. IR number, company name, bank account, employee details including name and IR number).
Applicants should check they’re applying for the correct payment. Some businesses apply for the Leave Support Scheme or the Short Term Absence Payment, when they are meant to apply for the COVID-19 Wage Subsidy August 2021. (Businesses can only receive one of these three COVID-19 payments for the same employee at the same time*.)
Eligibility Criteria
The eligibility criteria are similar to the March 2021 scheme, including employer obligations and revenue test.
It’s important applicants read all the information carefully, including the declaration they are agreeing to, and make sure they comply.
The revenue test is a decrease of at least 40%. This means:
Businesses need to have had (or expect to have) a minimum 40% decline in revenue in the 14-days since the Alert Level escalation (i.e. between 17 – 30 August 2021), when compared with their revenue during a typical 14-day period in the six weeks immediately before the Alert Level escalation.
o Businesses with highly seasonal revenue can compare their revenue to 17 – 30 August 2020 or 2019, if they can show that the seasonal nature of their business makes it harder for them to meet the revenue test using the default comparison period.
The decline in revenue must be caused by the effect of the national wide Alert Level increase on 17 August 2021 on their businesses.
After the payment is made
If the revenue decline doesn’t eventuate the business needs to repay the subsidy.
Businesses will need to prepare and keep evidence to support their declaration (but they don’t need to provide this on application)
MSD will complete background checks and target integrity activity. This means a sample of applicants will be asked for proof of revenue decline.
If the Government decides to extend the wage subsidy, businesses will need to make another application. At this stage the wage subsidy is only for two weeks.
Support types explained
Delivered by MSD
Information on COVID-19 supports can be found here (COVID-19 - Work and Income)
The Wage Subsidy Scheme which helps businesses to continue paying employees, keeping them on through lockdown.
The Short-Term Absence Payment which provides businesses with a one-off (once per 30 days) payment of $359 for employees who must miss work due to a COVID-19 test and can’t work from home.
The Leave Support Scheme provides businesses with a two-week lump sum payment of either $600 per week for full-time employees or $359 per week for part-time workers who have been advised that they must self-isolate and can’t work from home. Please check the health criteria on when an employee has been advised to self-isolate specifically.
Delivered by IRD
The Resurgence Support Payment for businesses that experience at least a 30% drop in revenue or a 30% decline in capital-raising ability over a relevant 7-day period. This payment, which is to assist with business costs like wages or fixed costs, will be available from 24 August 2021 until one month after a nationwide return to Alert Level 1. More info is here
The Small Business Cashflow Scheme supports small to medium businesses struggling with a loss of revenue due to COVID-19. Applications are open until 31 December 2023. More info is here
Finally, the best source of information for all things COVID-19-related is www.Covid19.govt.nz