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The wage subsidy & resurgence payment have been reactivated. The details you need to know are here. All of our Baker Tilly Staples Rodway Advisers are here to help with questions about the subsidies and support. This article has been updated 02/09/21.
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The Ministry of Social Development and Inland Revenue have released further detail around the Wage Subsidy and Resurgence Support Payment for the renewed lock down. The criteria for each support package varies and should be reviewed carefully.
Updated guidance 2 Sept 2021: The Wage subsidy is being delivered in fortnightly blocks this time around. The first block cuts off at 11.59pm on 2 Sept, with the second block running from 9am 3 Sept until 11.59pm on 16 September. It is anticipated the subsidy will continue in fortnightly rolling blocks while it is needed. More information is available here.
Key criteria are as follows:
The terms and conditions of the subsidy (here) also make it clear that if there is a predicted 40% decline in revenue but this does not eventuate, then the subsidy must be repaid.
We expect a high trust model will be implemented as before, but note businesses who expected a loss of 40 percent of revenue, but did not have this eventuate, have faced pressure to make repayment of the subsidy. In addition, we expect that further payments might be available should the heightened alert level remain for longer.
The Resurgence Support Payment is back for a fourth round. Key things to note are:
Both areas of relief can be applied for by eligible businesses, but as the criteria are slightly different for both, careful review is needed. For income tax purposes, both payments are exempt income, but the corresponding expenditure is non-deductible. For GST purposes, the Wage Subsidy is exempt, while the Resurgence Support Payment needs to be included in the GST return.
There are also HR considerations that may need to be worked through, especially if a wage decrease is proposed.
Previously, revenue decrease has had to be calculated based on the typical way in which revenue is measured, and we expect this to continue to be the case.
If you have any queries in relation to the relief available or require any assistance with making the calculations, please contact your Baker Tilly Staples Rodway advisor.
There are some minor changes to the Alert Levels "acceptable" activities which apply to businesses.
The government’s Alert Level framework has been designed to make it easy for the general public to follow. This time around, apart from some minor changes around compulsory masking and signing in, the rules have remained largely unchanged for the general public.
For business there have been some minor changes made. Key changes we have identified are:
A detailed list of the rules are located on the Ministry of Business, Innovation & Employment website here.
The key thing to remember is that activity involving potential physical contact must be kept to an absolute minimum.
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