Covid Support Update

Covid Support Payment
The Government has announced a new targeted COVID Support Payment for eligible businesses who have experienced a drop in revenue as a result of the Omicron outbreak.
The new COVID support payment will be $4,000 per business, plus $400 per full-time employee, capped at $24,000 or 50 FTEs. The revenue decrease has been set at a higher level to previous support measures. To be eligible, a business must have experienced a reduction in revenue of greater than 40 per cent over seven consecutive days compared with the same time period over the six weeks prior to the move to Phase 2 of the Omicron response on February 15 2022.
Applications for the first payment open on February 28 through Work and Income and will be available on a fortnightly basis for a 6 week period. Those eligible can receive up to three payments.

Small Business Cashflow Loans
For those entities who have already drawn down a Small Business Cashflow Loan, they are now eligible to apply for an additional $10,000 loan drawdown to assist their business. As per the terms of the first loan, the first two years will be interest free with a repayment period of five years.
For those entities who have not repaid their original loan, the government has removed the accrual of interest for the first two years if the loan has not been repaid within two years from the date it was originally drawn down. The balance together with interest will need to be repaid over the remaining three year term of the loan.

Leave Support Payments and Short-Term Absence Payments
With the Omicron outbreak growing, the use of these payments to assist with paying employees will grow.
If you or your employees become a close-contact and have to self isolate or contract Covid you may be eligible for these payments.
Per the declarations on the Work and Income website, you will need to get confirmation from your staff they are happy for you to apply for this assistance, and any reduction in wages as a result of their absence will need to be agreed to through a variation to their employment agreement.

 

A summary of the support payments previously announced and still available include:

Leave support
The Leave Support Scheme (LSS) is available for employers, including the self-employed, to help pay employees who need to self-isolate and can’t work from home. The scheme has now changed from two-weekly to a one-week payment to recognise the periods of self-isolation have changed.

Loan products
The Small Business Cashflow Loan Scheme grants eligible businesses an interest free loan (up to a capped maximum), if they repay it within 2 years. The scheme was extended, broadening eligibility, and extending its availability to 31 December 2023. Businesses or organisations that have fully repaid their loan before the end of 2023 can re-borrow.

Short-term absence payment
A short-term absence payment covers eligible workers (including self-employed) needing to stay at home while awaiting COVID-19 test results. It provides a one-off (once per 30 days) $359 payment. It also covers parents, caregivers, household members or secondary contacts of the eligible worker awaiting test results. You cannot get more than one COVID-19 payment for the same employee at the same time from Work and Income.

Tax debt
If you are unable to pay tax by the due date, Inland Revenue has discretion to write-off penalties and interest. Contact them to indicate when tax can be paid, or request instalment arrangements. You may be eligible for a UOMI write off.

Please contact our team if you have any questions.

Recent Blogs

Recent Client Stories

Arco Group Ltd

    Newsletter Signup

    Chartered AccountantsXero Gold PartnerMYOB BankLinkFarm FocusFiguredNorthland New ZealandMYOBWorkflowMax Certified AdvisorTax Traders Advantage PartnerNZ Chambers of CommerceSpotlight Reporting