This week, the Minister of Finance, Grant Robertson, announced additional funding support to help businesses struggling during the current COVID-19 outbreak.
Targeted COVID-19 Support Payment
A new targeted COVID-19 Support Payment for businesses experiencing a considerable drop in revenue during the Omicron outbreak. This payment is modelled on the previously available Resurgence Support Payment and will be administered in the same way through the IRD.
Firms must show a 40% drop in revenue from seven consecutive days within the six weeks prior to the shift to February 15, compared with seven consecutive days after that date.
Each COVID-19 Support Payment will be $4,000 per business plus $400 per full-time employee, capped at 50 FTEs or $24,000 – this is the same rate as the most recent Transition Payment.
Applications for the first payment open on Monday 28 February, with payments starting from Tuesday 1 March.
The support will be available on a fortnightly basis for six weeks – three payments in total. This reflects the international experience that the peak of the Omicron outbreak should pass after approximately six weeks. The Government has committed to continue to closely monitor the situation and has the option to extend the support if this if necessary.
Information about the COVID-19 Support Payment can be found here.
Changes to Small Business Cashflow Loans Scheme
A 'top up' loan of $10,000 will be made available with a new repayment period of five years and the first two years being interest free. In addition, all existing borrowers will have the first two years of accrued interest waived. This means interest will only start accruing at the beginning of year three.
Information about the Small Business Cashflow Loans Scheme can be found here.
Flexibility for Tax Payment Dates
The Government has again extended the Commissioner of Inland Revenue’s ability to apply flexibility for tax payment dates and terms to assist firms with cashflow pressures.
Any businesses struggling to pay tax because of the impacts of COVID-19 should login to myIR to see if they can delay starting payments to a later date, or if any part of the tax could be written off. The IRD can help with both GST and provisional tax due.
Need help understanding what funding is available? Please remember the Business Helpline can answer any questions you might have – this is a fully-funded service available for all businesses in the South Island. Please call: 0800 50 50 96.