Covid-19 Update
We know you are being inundated with correspondence regarding the Covid-19 virus, so we hope we are able to support you with constructive support and suggestions at this time.
Things to consider doing at this point
The key to going forward is to have a plan. And know that this plan needs to be fluid.
- Make a list of your concerns – write these down. Then put some priority around them.
- Consider approaching your bank now to get options in place regarding moving to interest-only and explore possible extensions to term periods.
- Look at the Wage Subsidy and Leave payments (see below).
- Look at identifying your break-even position so we can consider various scenarios. If you are on Xero we would recommend you look to using this to prepare a break-even position. Alicia and Cathy can assist with this.
Wage Subsidies
Wage subsidies will be available for businesses that can show a 30 percent decline in revenue for any month between January and June 2020 compared to the year before (or projected revenue for new businesses).
For eligible businesses, employers will be paid $585.50 per week for full-time staff, and $350 for part-time staff. Payments will be capped at $150,000 per business and will be paid in one lump sum for up to 12 weeks.
It’s not clear from the information provided, but it seems that shareholder-employees are also covered by this subsidy.
Application can be made online – see the link below. The process appears to be reasonably straight forward, and information provided on the website is both helpful and reasonably easy to follow. The form filling/information requirements do not appear onerous.
Leave Payments
Leave payments are available to those who need to self-isolate and cannot work, or who are sick or caring for a dependent who is sick with Covid-19.
The leave payment is available to employers, contractors, sole-traders and the self-employed for 8 weeks from 17 March 2020.
The leave payment may be applied for more than once and must be passed on in full.
The leave payment is $585.80 per full-time employee, or $350.00 per part-time employee.
Things to note:
The wage subsidy and leave payments are NOT subject to GST – an Order in Council is being drafted to treat it as exempt (Section 5(6E)(B)(iii GST Act).- The wage subsidy and leave payments are excluded income under section CX 47 of the Income Tax Act 2007.
- The payments made to employees ARE taxable and subject to PAYE, KiwiSaver etc in normal way.
For more information on the Wage and Leave Subsidies and to apply on-line go to:
https://www.workandincome.govt.nz/products/a-zbenefits/covid-19-support.html
We have created a short tutorial video to walk you through the application process. Please pay particular attention to the criteria for the wage subsidies and leave payments.
Application for Wage Subsidies and Leave Payments Tutorial NB: This link is best opened using Google Chrome.
Below is a link to a helpful flow chart from the Work & Income website.
Contact Information
We will remain contactable firstly by email/messaging in the following ways:
- By individual email using the links on our Team page on our website.
- Using the contact form on our website.
- Through Messenger on our Facebook page.
Our office is closed from today but we will be working remotely for the foreseeable future. You can still contact us if necessary by phone, and this will be diverted to a staff member working remotely.
These are unprecedented times. We need to stay calm and work through the issues that we are all facing.
We want to support you and will be advising in the next couple of days how to set up communication to do this online. In the meantime please contact us where you are concerned and have immediate issues.