Covid-19 Government Relief Package
The coronavirus outbreak is having a growing and significant impact on the New Zealand economy. The government has now announced a $12.1 billion relief package. We have summarised the details for you below and included links to the factsheets if you would like more information. There is a lot of details in those links so if you have questions please make sure to talk to us. We can help with applications and finding out if you are eligible.
Wage subsidies will be available for all employers that are significantly impacted by COVID-19 and are struggling to retain employees as a result. The scheme will be open to sole traders and the self-employed as well as firms.
$585.80 per week for a full time employee (20 hrs or more) or $350.00 per week for a part time employee (less than 20 hrs). The payment will be made as a lump sum for a period covering 12 weeks.
Employers must have suffered, or are projected to suffer at least a 30% decline in revenue compared to last year for any month between January 2020 and the end of the scheme in June 2020.
COVID-19 Leave – self isolation
The COVID-19 leave payment scheme will provide support (through employers/to sole traders and the self-employed) for those people unable to work who are in self-isolation, are sick with COVID-19, or caring for others with COVID-19. The payments will be $585.80 per week for full time and $350 per week for part time workers.
The payment does not affect any paid leave entitlements that are owed and is available even if an employee is on paid leave for part of the period. It is not available to those who can work from home during the period of self-isolation, and who can be paid normally by their employer.
Assistance includes an increase in the instant asset write-off, an increase in the provisional tax threshold from $2500 to $5000, and building depreciation deductions.
There are three main changes to welfare settings. Firstly, main benefits will rise by $25 per week. These changes will come into effect on 1 April 2020 and are permanent. Secondly, to support beneficiaries and superannuitants, the rate of Winter Energy Payment will double in 2020. This change is temporary. Thirdly, from 1 July 2020, working families with children who are not receiving a main benefit and have some level of employment income each week will no longer have to satisfy the hours test to receive the In Work Tax Credit.
The government has moved quickly to implement this package and the affected businesses can now apply for the wage subsidy and/or COVID-19 leave. The application once made can take around five working days to process depending on the volume received.
If you feel like you are in or are likely to be in financial difficulty, please fill in the form below to request a discussion with your accountant.