Tax Talk | Wage Subsidy, Resurgence payment & premises access

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. 

Time to read: 4 mins

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.

Wage Subsidy August 2021: Subsidy #2

  • Applications for this subsidy will open at 9am Friday 3 September.
  • This is for all businesses and self-employed people who have or predict at least 40% decline in their revenue from 31 August to 13 Sept and meet all eligibility criteria.

Key Criteria for Wage Subsidy August 2021: Subsidy #1

Key criteria are as follows:

  • At least a 40% revenue decline over the period between 17 August 2021 and 31 August 2021 (inclusive), compared to a typical 14-day consecutive period of revenue in the six weeks immediately before the move to Alert Level 4 on 17 August 2021, or
  • If your business has highly seasonal revenue, you must have at least 40% decline over the revenue test period compared to the same 14 consecutive days in 2020 or 2019, provided you can demonstrate the seasonal nature of your business makes it harder to meet the 40% revenue decline using the default comparator period than if your business was not of a seasonal nature.
  • You must have taken active steps to mitigate the impact of the move to Alert Level 4 on 17 August 2021 on your business activities. This includes (but is not limited to) engaging with your bank, drawing on your cash reserves as appropriate, or making an insurance claim.
  • Best endeavours must be made to pay at least 80 per cent of the ordinary wages or salary of each employee and each employee must at least received the full amount of the subsidy unless it is above their ordinary wages or salary, in which case they should continue to be paid their ordinary wages or salary.
  • Predicted falls in capital income can be used in limited circumstances.

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.

Resurgence Support Payment

The Resurgence Support Payment is back for a fourth round. Key things to note are:

  • Eligible businesses throughout New Zealand can apply for the Resurgence Support Payment if they incur a loss of 30 percent of revenue as a result of the Alert Level change to Level 4.
  • The Resurgence Support Payment continues to be $1,500 plus $400 per full-time equivalent employee, up to a maximum of 50 full-time employees (so a maximum payment of $21,500).
  • Your business needs to have been in operation for at least one month prior to the alert level change on 17 August 2021
  • An actual 30% decline in revenue in a 7 day period after 17 August 2021 as compared with a typical 7 day period in the six weeks prior to 17 August 2021 must have occurred.


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

Acceptable Activities - Level 4 

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:

  • Workers can now access workplaces to pick up equipment in limited circumstances (e.g. collecting a laptop or specialised equipment); and
  • There is increased ability to make contactless sale and delivery of uncooked food products (e.g. a greengrocer or butcher selling online).

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. 

DISCLAIMER: No liability is assumed by Baker Tilly Staples Rodway for any losses suffered by any person relying directly or indirectly upon any article within this website. It is recommended that you consult your advisor before acting on this information.

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