Weekly Digest – 20 October 2021
Welcome back to our Weekly Digest. Read on for the latest updates and some ideas to help us all move forward.
2.5% of Population Vaccinated in One Day
The government vaccinated at least 2.5% of the country’s population on Saturday, with 124,669 shots administered throughout the country. However, Auckland will stay in lockdown for at least another two weeks, Prime Minister Jacinda Ardern announced on Monday.
Inland Revenue to Go Offline for a Week
Inland Revenue’s computer systems will go offline for a week to complete the final stage of its $1.7 billion Business Transformation project.
Online services and call centres will be offline from 3 pm on Thursday until Thursday morning the following week. Offices will also be closed to the public.
The changes will see the systems that manage child support payments moved from its outdated mainframe-based First computer system to its new technology platform, Start. If you have any queries, please get in touch.
Quarantine-Free Travel From NZ’s South Island to Australia
Months after the travel bubble was temporarily paused due to the growing number of COVID-19 cases in Australia, quarantine-free travel from the South Island to Australia will reopen from midnight Tuesday next week.
However, travel from the North Island will remain off limits until the end of the month. Those travelling from NZ will need to take a pre-departure PCR test within 72 hours of their flight and show evidence they are fully vaccinated. They will also have to declare they haven’t been to the North Island in the last 14 days.
ANZ Survey: Business Confidence Declines in October
Business sentiment fell in October from the previous month, according to ANZ Bank’s preliminary survey. This comes as Auckland remains in lockdown to contain the Delta outbreak.
The survey’s headline measure showed a net 8.6% of respondents expected the economy to deteriorate over the year ahead, up from 7.2% pessimism level in the September poll.
Inflation Surged to Fastest Pace in 10 Years
Inflation increased to the fastest pace in 10 years during the third quarter, reinforcing expectations that the central bank will keep raising interest rates. From 3.3% in the second quarter, annual inflation rate jumped to 4.9%, beating economists’ forecast of 4.2%.
Support available to you
Work and Income has a Find COVID-19 Support tool to help you find the support options you’re eligible for.
If your business has to close temporarily or reduce opening hours
COVID-19 Wage Subsidy
The Wage Subsidy August 2021 is available to eligible businesses in New Zealand affected by the continuation of Alert Levels 3 and 4 from 17 August 2021.
Businesses and self-employed people must meet the decline in revenue tests to be eligible to receive the wage subsidy.
The wage subsidy is paid in a 2 week lump sum. You can get:
- $600 per week for each full-time employee
- $359 per week for each part-time worker retained.
As an employer you must pass on the full wage subsidy to your employee. If the wage subsidy is more than your employee’s pay, you can continue to pay them at their normal rate.
Find out more about the Leave Support Scheme on the Work and Income website.
Wage Subsidy 2021 #5 open
Applications for the fifth Wage Subsidy are open for two weeks between 15 October and 28 October.
You can check the eligibility requirements here. Get in touch with us if you have any questions.
Inland Revenue is updating their systems between 21 and 28 October. This may delay some COVID-19 Wage Subsidy August 2021 applications, because Work and Income will need to verify your information with Inland Revenue. You can still apply during this time.
COVID-19 Resurgence Support Payment
The COVID-19 Resurgence Support Payment helps cover wages and fixed costs for businesses who have been directly affected when there is an increase to Alert Level 2 or higher for a week or more.
To be eligible, your business must have experienced at least a 30% drop in revenue or a 30% decline in capital-raising ability over a 7-day period, due to the increase in Alert Levels.
You can receive $1,500 per business plus $400 per full-time employee (FTE), up to 50 FTE. If you’re a sole trader, you can receive a payment of up to $1,900.
Applications for the COVID-19 Resurgence Support Payment are open. You need to apply through Inland Revenue. Businesses anywhere in New Zealand can apply if they meet the eligibility criteria.
Find out more information about the COVID-19 Resurgence Support Payment and how to apply here.
If your business has reduced revenue
Small Business Cashflow Loan Scheme
If you employ 50 or fewer staff, you may be able to apply for the Small Business Cashflow Loan Scheme. This is a one-off 5 year loan where you can borrow a maximum of $10,000 plus $1,800 per full-time-equivalent employee within your business.
- When applying for the loan, you need to be able to declare that your business is viable.
- Your business must have experienced a minimum 30% decline in actual or predicted revenue over the period of a month, compared with the same month last year.
- Applications are open until 31 December 2023 through myIR. If your business does not have a myIR account, you will need to create one to apply.
Loans will be interest free if they are paid back within 2 years. The interest rate is 3% for a maximum term of 5 years.
IRD tax assistance
If you’re finding it hard to meet your tax obligations, Inland Revenue may be able to help. Get in touch with us if you have any questions.
The COVID-19 Business Debt Hibernation scheme allows businesses to get a month’s protection while they talk to their creditors.
If an employee needs to self isolate
COVID-19 Leave Support Scheme
If an employee cannot work from home while self-isolating, you may be able to apply for financial support so they can continue to get paid.
The Leave Support Scheme is paid as a 2 week lump sum at the rate of:
- $600 a week for full-time employees
- $359 a week for part-time employees
You cannot get the Wage Subsidy August 2021, Leave Support Scheme and Short-Term Absence Payment for the same employee at the same time.
If an employee is awaiting the result of a COVID-19 rest
COVID-19 Short-Term Absence Payment
The Short-Term Absence Payment is available for businesses, including self-employed people, to help pay employees who cannot work from home while they wait at home for a COVID-19 test result. This is a one-off payment of $350. You can find the details here.
Kiwi Business Boost Tool
The Government has funded specialist consultancy support services to provide advice to businesses who need it. You can use the Kiwi Business Boost Tool to find out what services are available in your region.
The Treasury website’s COVID-19 Economic Response Measures can also provide more information on the range of support available to businesses.
Training Incentive Allowance
The Training Incentive Allowance can help with tuition fees, books, childcare, equipment, transport and any additional caring costs while studying. It’s available for courses at levels 1-7 of the NZ Qualifications Framework. Visit the Work and Income website to find out who’s eligible, how much you can get and who can apply.
Modernise your Financial Department
It is not uncommon for startups and small businesses to operate with limited resources. But smart technology tools can enable small teams to operate at a larger level, giving them a competitive edge despite their size.
This Forbes article discusses how you can take a modern approach to finance and adopt a strategy that encourages business growth.
- Employ more strategic cash flow management. Improving simple practices such as sending invoices as soon as possible, using online invoicing tools, evaluating where you can reduce expenses, and adjusting inventory.
- Schedule regular financial forecasts to gauge profitability. Financial forecasting is critical for both short- and long-term scenario planning, and an effective tool to estimate profitability.
- Invest in the right technology. Automation can make manual processes much more efficient, increasing the importance of an organisation’s finance tech stack.
Modernising financial management is not as difficult as it seems. However, it takes dedication to ensure your team is on the right track. If you need some guidance with your business finances, get in touch with us today.
Get in touch
Contact us if you have any questions or want to discuss the next steps for your business.