UPDATES ON LAST WEEK’S NEWSLETTER:

THE WAGE SUBSIDY – THE MAIN POINTS TO BE AWARE OF:
• Eligible businesses would need to have had a 40% drop in revenue over a consecutive 14-day period between 17 August and 30 August, compared to the fortnightly revenue during the six weeks prior to the COVID-19 Alert Level change (in this case, the date range should be 6 July to 16 August 2021). After today’s announcement (23/08), most businesses that aren’t essential and/or don’t have staff that can work from home (where you haven’t had a 40% drop in revenue), should be able to apply for the wage subsidy. If you think it will be close, you can always apply for this, but be prepared to pay this back, if needed.
• The new subsidy amounts will be $600 per week, per full-time employee (works 20+ hours per week) and $359 per week, per part-time employee (works under 20 hours per week).
• Applications opened last Friday (20/08) for the current COVID-19 wage subsidy through the Work and Income (MSD) website. You can view the link here. Your business should receive payment within 3 days of your application.
• Your business may need to provide evidence of the 40% decline in revenue, and prove that this was due to the Alert Level change, if required by MSD (Not due to normal seasonal variations).
• Other requirements include – Getting consent from your employees before applying for the wage subsidy (ideally in writing) for privacy reasons, the subsidy amounts must be passed onto your staff and your business should be taking steps to mitigate the financial impact of COVID-19 as much as you can.
• The wage subsidy payments you make to your employees through your payroll provider should be similar to last year, however if you are not sure, please feel free to contact us on 03 374 9393. You can also contact us if you are not sure where to code this payment to.
• Another way to prove a drop in revenue is production/timesheet hours, because even when you get back to work, within the first 14 days, it may take awhile to get back up and running again. Keep these all as records.
• You can apply for the wage subsidy for a new employee that started within the lockdown period, but only for the weeks where their employment contract has started.

Important note: Make sure when you complete your invoicing that the dates of your invoices are when you completed the sale/job, not dated during the Level 4 lockdown period (the 14 day period MSD is counting as your fortnight for the revenue drop is between the 17th and 30th of August).

RESURGENCE SUPPORT PAYMENT – THE MAIN POINTS TO BE AWARE OF:
• Eligible businesses would need to have suffered a 30 percent drop in revenue, over a 7 day period, while in Alert Level 2 and higher. You would need to compare your 7 days in Alert Level 2 or higher, with a 7 day period anytime during the 6 weeks prior to the Alert Level change (In this case, the prior date range should be 6 July to 16 August 2021).
• The RSP is available for businesses (including sole traders) that have been operating for 6 months or more. The full eligibility criteria can be found here.
• The payment is for your business, not your employees, and is to help cover things like overheads.
• The amount you receive depends on the size of your business. This is $1500 per individual business, plus an extra $400 per employee up to a maximum of 50 full-time employees. This makes the maximum payment $21,500.
• You can use this calculator to estimate the amount you may be entitled to if you meet the eligibility criteria.
• There is also a ‘lesser of’ test, meaning that the amount of the payment is the lesser of the amount calculated using the previously mentioned formula and four times the actual revenue decline. This lesser test is for when a businesses normal revenue is below the RSP payment. Use the RSP calculator link above to work this out for you.
• It is worth noting that the RSP is subject to GST, so if you are a GST-registered business you will end up returning 3/23rds of the payment back to Inland Revenue. However input tax credit’s can be claimed when the RSP is spent.
• Applications for the RSP are administered by Inland Revenue and open tomorrow (24/08) at 8am. You can find the link to apply here. Note when you complete the application you may need to add new and remove old employees.
• It’s possible that the Government could activate the RSP payment multiple times when New Zealand goes into Alert Level 2 or higher, but we will keep you updated on this. This is not a loan, so does not need to be paid back for eligible businesses.

You can view other COVID-19 support for businesses here.

If you are concerned about cash flow or would like to know exactly where the cash flow for your business is going to be for the next 3, 6 or 12 months, then we strongly recommend you contact us to do a budget/cash flow forecast. Please feel free to contact us on 03 374 9393 for more information. You may even be eligible for funding.

Call Now ButtonCall Now