This article was updated on May 5, 2020 to include:
- Australian cash for SMEs extra payments
- UK wage relief online applications now open
- New NZ Small Business Cashflow Loan Scheme and Regional Business Partner Network support launched
- US Employee Retention Tax Credit scheme now open; Airline grants and loans scheme details outlined; CARES Act funding applications open
- Canadian Work Sharing Program applications open; Canada Emergency Wage Subsidy (CEWS) scheme now open; Canada Emergency Business Account opens; Business Credit Availability Program opens
Government Coronavirus support packages covered in this article:
- The Australian Government support package
- The United Kingdom Government support package
- The Republic of Ireland Government support package
- The New Zealand Government support package
- The US Government support package
- The Canadian Government support package
The Australian Government Coronavirus support package
The Australian Government announced two separate support packages and A$100 billion in emergency banking measures for a combined A$320 billion in support for Australian households and businesses.
Australia has rolled out two Coronavirus support packages to date, totalling A$320 billion. Photo credit: Aditya Joshi
What’s in the package for Australian businesses?
What: A$1,500 per fortnight per eligible employee for a maximum of 6 months
Who: Businesses, Not-For-Profits and Sole Traders experiencing a 30% drop in turnover (for companies of less than A$1 billion), or a 50% drop (companies greater than A$1 billion). Banks with over $100 billion in total liabilities are not eligible.
How: Register via the ATO from March 30, prove the required drop in turnover, notify your employees, and update the ATO monthly. Payments commence May
What: Reduce your income tax payments by offsetting large assets against your income all at once. Specifically: The Instant Asset Write Off threshold is being raised to $150,000 and expanded in scope
Who: All businesses with aggregated annual turnover less than $500 million until 30 June 2020
What: A$20,000-$100,000 payment for employers, based on the income tax they normally withhold. An additional 2-4 cash flow boosts will be applied when activity statements for each monthly or quarterly period from June to September 2020 are lodged.
Who: SMEs and NFPs with employees that have aggregated annual turnover under A$50 million
How: Automatic credit by the ATO from 28 April 2020 upon employers lodging eligible upcoming activity statements. See details here.
What: Sole Traders can access superannuation fund early
Who: Sole traders that have their business suspended or have a reduction in turnover of 20%
How: Apply via Mygov.
What: Harder for creditors to make statutory demands on a company or initiate bankruptcy; directors get temporary personal liability relief
Who: Debtors, company owners and directors
What: The Government will underwrite unsecured loans of up to $250,000 per borrower. Repayment term is three years, with a six month repayment holiday
Who: SMEs with a turnover of up to $50 million
How: Via banks from April 2020 until 30 September 2020
The United Kingdom Government Coronavirus support package
At least £428 billion is being injected into the UK economy through a massive business bailout programme and wage support.
The UK’s support package amounts to £428 billion. Photo credit: by Heidi Fin
What’s in the package for UK businesses?
What: Employers can claim 80% of wages for workers on a leave of absence for up to £2,500 a month, for the 3 months starting from March 1. Expected to be open in April 2020.
Who: Any UK organisation with employees, a UK bank account, and with a PAYE payroll scheme since 28 February 2020
What: Partially Government backed loans up to £5 million with repayment terms up to six years. The borrower remains 100% liable for the debt but Government covers interest for the first year
Who: UK businesses up to £45 million in turnover. Banks, insurers, public sector bodies and some others not eligible. See the eligibility checklist here
How: Approach a lender directly
What: 12 month business rates holiday for affected retail, hospitality, nursery and leisure businesses
Who: Rate paying businesses in these sectors, in England only
How: Automatically via local bodies
What: No business will automatically forfeit their lease and be forced out of their premises if they miss a rent payment up until 30 June. Non-payers are still liable for all debt
Who: All commercial tenants in England, Wales and Northern Ireland
How: No action needed
What: Both VAT and other business tax payments can be deferred
Who: UK VAT registered business with payments due between 20 March 2020 and 30 June 2020 + others
How: Via Gov.co.uk
What: The Government will reimburse businesses for up to two weeks’ sick pay issued to employees with Covid-19
Who: Employers with fewer than 250 employees
How: Online portal not yet available as of May 5. Check here for updates and eligibility details
What: The Bank of England will buy debt from large affected companies in order to provide short term liquidity
Who: Companies that had a short or long-term rating of investment grade, as at 1 March 2020
How: Directly via these banks
The Republic of Ireland Coronavirus support package
Ireland has set aside €3.7 billion for business and workers in an attempt to stave off the worst of Covid-19’s impacts.
Irish businesses have a variety of supports. Photo credit: Nicholas Punter
What’s in the package for Irish businesses?
What: 70% of take home pay up to a maximum weekly tax free amount of €410. The scheme runs for 12 weeks from 26 March 2020.
Who: Employers in all sectors with a minimum of 25% decline in turnover, and an inability to pay normal wages. Employees must have been on payroll in February 2020
How: Apply via Revenue (Irish tax and customs)
What: Loans from €25,000 to €1.5 million (first €500,000 unsecured) with a maximum interest rate of 4%. Plus a €5,000 grant towards financial planning / application costs via Enterprise Ireland
Who: Business with up to 499 employees; some exclusions apply
How: Apply via the Strategic Banking Corporation of Ireland
What: €2,500 towards third party consultancy costs to develop strategies to respond to the Covid-19 pandemic
Who: Businesses employing up to 50 people
What: Commercial rates will be deferred for the most affected sectors for three months, until end-May; Restaurants may also act as takeaways without apply for planning permission
Who: Retail, hospitality, leisure and childcare sectors
How: Via local authorities
What: A wide range of tax measures have been relaxed and deadlines deferred
Who: Irish SMEs (€3 million turnover or less)
How: Details via Revenue
The New Zealand Government support package
In mid-March the New Zealand Government announced a $12.1 billion package, consisting of $8.7 billion in business and wage support, and the remainder in health, and welfare and spending stimulus.
The primary element of support for business to date has been wage subsidies. Photo Credit: Pat Ho
What’s in the package for NZ businesses?
What: 12 weeks of lump-sum wage support paid to affected employers, amounting to $585.80 per week for each full time (20hrs+) employee and $350 per week for part time
Who: NZ companies suffering – or projected to suffer – a 30% loss in revenue between January 2020 and June 2020, measured year-on-year
How: Apply via Work and Income NZ using this form. Employers must sign a declaration that they will retain and pay their employees for the period covered, among other details. Money is deposited within 5 working days
What: Purchases of assets up to $5000 can be deducted from income in full (up from $500);
Commercial and industrial building owners (including hotels and motels) can also deduct depreciation of buildings, and earthquake strengthening work, by 2% yearly, reducing provisional tax immediately. Some relief from provisional tax and late payment penalties.
Who: All businesses; Commercial and industrial building owners
How: No claim needed. Administered by Inland Revenue
What: One time loan of up to $100,000 for SMEs. “Loans will be interest free if they are paid back within a year. After that, the interest rate will be 3% for a maximum term of five years. Repayments are not required for the first two years.”
Who: Firms employing 50 or fewer full time equivalent employees
How: Applications open May 12 via Inland Revenue. See this page for updates.
What: Up to $5000 to spend on advisory services via the Regional Business Partner Network
Who: GST registered NZ businesses with fewer than 100 FTEs. See further eligibility criteria here
The US Government support package
The US Senate passed a US$2 trillion rescue package on March 24, with much of the funding taking the form of loans that won’t need to be repaid if applicants fulfil set criteria, plus tax relief, grants and direct payments to all Americans.
The US support package is both enormous and widespread. Photo Credit: Andy Feliciotti
What’s in the package for US businesses?
What: Loans of up to US$10 million to cover payroll, paid sick leave, insurance premiums, rent, utilities, and mortgage payments. If for the following eight weeks you keep your staff on and don’t reduce their pay by more than 25% you don’t have to pay it back
Who: Companies with fewer than 500 employees, plus NFPs, veterans and tribal groups. A salary cap of US$100,000 per employee limits the amount of payroll relief high-earners can receive
How: Directly via banks after completing application form. Apply by June 30, 2020. See details here
What: Tax credits to companies to cover sick leave payments for workers, plus paid family leave due to Covid-19: 80 hours paid sick leave, up to an additional ten weeks of paid family leave to care for a child whose school or place of care is closed. Period covered is April 1 – December 31, 2020.
Who: Businesses with fewer than 500 employees
What: Six month loan repayment holiday for those in the Small Business Administration programme. These repayments won’t have to be remade
Who: Small business owners participating in the 7(a), Community Advantage, 504, or microloan programs
How: No action required
What: Low interest loans of up to $10 million, with $10,000 upfront that doesn’t need to be repaid
Who: Companies with fewer than 500 employees, independent contractors, Co-ops, NFPs and tribal groups
How: Online application via the Small Business Association
Employee Retention Tax Credit
What: Up to $5,000 per worker in tax credits to businesses that retain idled staff
Who: Businesses that can demonstrate a 50% loss compared to the same quarter in previous years. You can only get the tax credit OR the SBA loan, not both
How: Details via the IRS
Tax relief for retailers, restaurants and hotels
What: Property improvements now immediately tax deductable for retailers, restaurants and hotels
How: Details tbc
Employer tax relief
What: Social Security tax of 6.2% deferred, to be repaid in following two years
Who: Employers and the self-employed
How: Details tbc via the IRS: “Do not call. Check back for updates”
Airline grants, loans and tax relief
What: US$29 billion in grants for wage relief and $US29 billion in low cost loans and loan guarantees – plus exemption from excise, fuel and cargo taxes
Who: Airline companies, repair stations and ticket agents
Healthcare provider grants
What: Healthcare providers to receive US$100 billion in grants plus 20% increase in Medicare for treating Covid-19 patients
Who: Largely hospitals
The Canadian Government Coronavirus support package
The aid package includes C$52 billion in direct financial support for individuals and businesses and C$55 billion in tax deferrals.
Both tax relief and direct support will help prop up Canadian businesses. Photo Credit: Pam Menegakis
What’s in the package for Canadian businesses?
What: The maximum duration of the WSP period has extended from 38 weeks to 76 weeks. The WSP provides wage subsidies if employers reduce hours rather than lay off staff
Who: Small businesses and NFPs operating in Canada for two years or more that paid C$50,000 to C$1 million in total payroll in 2019
Small business wage subsidies
What: Up to 75% wage subsidy for up to 3 months, retroactive to March 15
How: Apply here
What: Interest-free loans up to C$40,000
Who: Small businesses and NFPs that can demonstrate they paid C$50,000 to C$1 million in total payroll in 2019
How: Work with established financial institutions. Application details here
What: Co-lending and Loan Guarantees – specifically operating credit and cash flow term loans of up to $6.25 million, with 80 per cent guaranteed by Export Development Canada
Who: “Credit-worthy Canadian businesses with viable business models”
How: Work with established financial institutions. “This program is now available at various financial institutions and credit unions”
What: Business tax payments can be deferred until after August 31, 2020
Who: Corporations, the self-employed, trusts and charities
How: No action required. See the CRA for details
What: Farm Credit Canada is easing lending criteria: deferral of principal and interest payments up to six months on existing loans OR deferral of principal payments up to 12 months, plus additional credit lines up to C$500,000
Who: Producers, agribusinesses and food processors
How: Contact your local FCC branch
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Article by Greg Roughan in collaboration with our team of inventory management and business specialists. Greg has been writing, publishing and working with content for more than 20 years. His writing motto is ‘don’t be boring’. His outdoors motto is ”I wish I hadn’t brought my headtorch’, said nobody, ever’. He lives in Auckland, New Zealand, with his family.