The NZ government has announced three additional options for financial support for businesses with cash flow pressures due to COVID-19.
SMALL BUSINESS CASHFLOW SCHEME (SBCS) CHANGES
- The base loan will be increased from $10,000 to $20,000
- The loan payment period remains 5 years
- The first 2 years of existing loans will become interest-free (provided the loan is not in default)
- Existing borrowers can apply for a top up loan
- The SBSC is open until 31 December 2023 and applications should be made through myIR
NEW COVID-19 SUPPORT PAYMENT (CSP)
- This payment is for businesses struggling with revenue during the Omicron outbreak
- Eligible businesses need to show a 40% or more drop in revenue due to 1 or more of the following:
-the widespread presence of COVID-19 in the New Zealand community
-the legislative public health measures taken in order to reduce the spread of COVID-19 in the New Zealand community
– any business circumstances that are, or are reasonably likely to be, a consequence of the circumstances described above.
- Three fortnightly payments will be available for application
- Each CSP will be $4,000 per business plus $400 per full-time employee (capped at 50 full-time employees or $24,000)
- Applications for the first payment will open at 8am on 28 February 2022 for the period starting from 16 February 2022
More details can be found here.
REMITTANCE OF PENALITES & INTEREST
Inland Revenue’s ability to remit interest if a business is late paying its tax because they are adversely affected by COVID-19 has been extended.
- Contact Inland Revenue as soon as you know you will not be able to pay your tax on time OR contact your tax agent to communicate with IRD in your behalf
- Penalties and interest can be remitted for tax payments due on or after 14 February 2020 up until 24 March 2022 (including provisional tax)
- To reduce interest charges, the original amount must be paid in full by 7 April 2024.
- Inland Revenue may check the customer’s declaration that their business was significantly affected by COVID-19
- Businesses should keep records such as bank and credit card statements, management accounts, and debtor and creditor lists.
You can also still take advantage of the following if you qualify: