Latest COVID-19 assistance update

Although we have had an extended run of no new COVID-19 cases, this hasn’t stopped there being new announcements and changes made to financial and taxation related measures associated with COVID-19. These are some of the recent ones:

Changes to the extended wages subsidy

The eight week extension to the wage subsidy provided support for businesses that had experienced a 50% decline in revenue during a qualifying period. This has now been changed to only requiring a 40% drop in revenue.

The qualifying period to measure the 40% drop in revenue has also been defined and requires there to have been a 40% drop in revenue for a 30 day period in the 40 days before applying (starting no earlier than 10 May 2020), compared to a similar period last year. Qualification for the subsidy begins after your initial 12 week period ends so it will depend on when you initially received the original subsidy.

The subsidy remains available from 10 June until 1 September 2020. The method for applying and other payment to employee criteria remain the same.

Government Small Business Cash Flow Loan Scheme extension

This is the loan administered by Inland Revenue to provide for a loan amount of $10,000 plus $1,800 per full-time-equivalent employee, to a maximum of $100,000. Originally the time to apply ended 12 June but this has now been extended until 24 July. The scheme requires applications to be made through a myIR with IRD. Although tax agents are able to advise and provide support, we are unable to apply for you. More details and instructions on how to apply are available here on the IRD website (valid at 6 June).

COVID-19 Income Relief Payment

If you lose your job (including self-employment) from 1 March 2020 to 30 October 2020 due to COVID-19, you may be eligible for the COVID-19 Income Relief Payment. It’s available from 8 June 2020 for up to 12 weeks of payments. Payments received are non-taxable and this payment is administered through Work & Income. You can find out how to apply through Work & Income here.

Change in tax write-off threshold

If your only income is PAYE salaries and wages, and you’re not required to file a return, IRD’s new system automatically checks if you have tax to pay or are due a refund. The threshold for paying tax has been increased from $50 to $200, meaning if your PAYE had been under-deducted but this resulted in less than $200 tax to pay, IRD will now write this off. If the amount is over $200, the tax is payable. Refunds remain unchanged.

As with all our previous updates, and for any business or tax questions, please contact us.

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