COVID-19 impact assistance and resources
March 19, 2020
The impact of the potential spread of the COVID-19 continues to be concerning, if not distressing. It is a difficult situation as there is a great deal of uncertainty and unknown, with no end in sight. New developments occur everyday.
From a financial or business perspective, continuity and remaining a viable business are genuine concerns. Air New Zealand cutting its Trans-Tasman flights by 80%and staff by 30% is a headline indicator of these worries. Despite this, there are resources to help you identify your position and help you cope as the situation evolves.
First, as your accountants and advisors, don’t hesitate to contact us to review together where you are financially at present, to examine what resources and assistance is available to you (examples below) and to summarise your requirements and options. We welcome hearing from you
Second, banks have (so far) indicated their support and have taken some tangible steps to help with the financial strains of social isolation and lower turnover. BNZ, for instance, has lowered by 1% its interest rates on arranged overdrafts and has released other supports. Contacting your bank to discuss your options is important assistance.
Third, the Government’s relief package announced 17 March (with additional details still to be provided) contains measures to help including
- A 12 week wage subsidy for qualifying businesses. A component of the prerequisites to qualifying is being able to demonstrate a 30% reduction in turnover from months from January to June this year compared to last year. We can help you with calculating this.
- Increasing the ability to expense asset purchases less than $5000 during the 2020/2021 tax year. If you were thinking of replacing your laptop, for example, you’ll this year be able to claim a full tax deduction for its purchase (remembering that the untaxed portion—72% if you’re a company—remains your cost).
- Write-off of use of money interest for late tax payments that can be demonstrated to have been caused by COVID-19 impacts.
There are other measures contained in the announcement and anticipated in the next Budget. Please contact us if you have any questions.
Some useful links to information about the package and to make application can be found here (current at the date of this newsletter)
Fourth, the Xero Assistance programme provides free and confidential mental health support for certain Xero subscribers.
These are just some of the mechanisms available. It is a difficult balancing act between acting rationally during this admittedly difficult situation and getting caught up in it and stressing out. We can’t emphasise enough, we are here to help work through your options and risks and we look forward to making contact.
Contact us today for your no-obligation consultation.