Got staff? Wage subsidy applications close 1 September 2020 at 11.59 pm.
Low-interest loans from the government
What it is: Low-interest one-off loan of up to $10,000 + $1,800 for each full-time equivalent employee.
- 3% interest rate
- repay over 5 years
- no payments in the first 2 years — but you can choose to make payments
- payments handled by Inland Revenue.
No interest charged if you pay back the loan within a year.
Who can get it:
Smaller businesses struggling financially due to the COVID-19 pandemic, including:
- businesses with up 50 employees
- sole traders
- self-employed people.
As with any loan, you must also be able to show you can pay it back. Your business needs to be viable, with a plan to stay that way.
Deadline to apply: 31 December 2020
How to apply: On the Inland Revenue website, using your myIR account.
Small Business (Loan) Cashflow Scheme — Inland Revenue
Also consider: Borrowing money or getting credit from a bank taking part in the Business Finance Guarantee scheme for small and medium-size businesses.
Business Finance Guarantee scheme — Treasury
Tax refunds
Who can get it: Businesses that:
- ended the 2019 tax year in profit (usually 1 April 2019 to 31 March 2020)
- expect to make a loss in the 2020 tax year or 2021 tax year due to the impact of the COVID-19 pandemic.
Deadline to apply: It’s a good idea to tell IR you plan to do this as soon as possible. If you have already paid provisional tax for 2020, you may be eligible for a refund.
How to apply: You must tell IR you plan to use the loss carry-back scheme. It’s easiest to do this online via myIR, using the “I want to” section.
For more detail on how to use the carry-back scheme, see the IR website:
Temporary loss carry-back scheme — Inland Revenue
Also consider: Inland Revenue’s cash flow and tax relief measures to help businesses as they recover.
COVID-19 Businesses and organisations — Inland Revenue
Wage subsidy extension applications closing soon
What it is: Payments to help cover wages or salaries, open for applications from 10 June to 1 September 2020. It’s an extension of original wage subsidy scheme, announced as New Zealand went into Level 4 lockdown.
Who can get it: Businesses and self-employed people still financially impacted by the COVID-19 pandemic. You must have a minimum 40% decline in revenue over a 30-day period within 40 days before you apply for the extension.
All business types that meet the financial criteria are eligible, including:
- businesses with employees
- sole traders
- contractors
- self-employed people
- registered charities.
Who can get it — Work and Income
Deadline to apply: 11.59 pm on 1 September 2020
How to apply: Use the online form on the Work and Income website. You’ll need your NZBN, the IRD numbers of your business and any employees, plus other details.
- If you received the original 12-week subsidy for your worker(s) or yourself, you need to apply again for the extension.
- If you haven’t applied for the wage subsidy before, you can apply for the extension.
Apply for the wage subsidy extension — Work and Income
Also consider: Leave support payments if an employee cannot work due to COVID-19 public health guidance.
COVID-19 Leave Support Scheme — Work and Income
Payments for employers with first or second-year apprentices to help cover wages. For each eligible apprentice, employers can claim $500 to $1,000 a month from August 2020 to April 2022.
Apprenticeship Boost Initiative — Work and Income
Income relief payments
What it is: Up to 12 weeks of payments to help with living costs after sudden job loss during the COVID-19 pandemic. If eligible, you will get $250 or $490 a week depending on the number of hours you previously worked.
Who can get it: You may be eligible if you lose your job between 1 March and 30 October 2020. This includes:
- employees
- contractors
- self-employed people.
Before losing your job, you must have been employed for at least 12 weeks and have worked an average of at least 15 hours a week.
Deadline to apply: 13 November 2020
How to apply: Check full eligibility criteria on the Work and Income website.
Income relief payments — Work and Income
Help with commercial lease disputes
What is it: Temporary law changes and subsidies for arbitration/mediation to help commercial tenants and landlords share the financial impact of COVID-19.
Law changes backdated to 1 April 2020 include:
- More time for commercial tenants to catch up on overdue rent.
- Longer notice period for cancelling a lease because of overdue rent, up from 10 working days to 30 working days.
- More time for mortgage borrowers, including landlords, to catch up on overdue mortgage payments.
Details of the subsidised arbitration/mediation are still being finalised. The service is likely to be available from late September.
Who it’s for: The law changes aim to help:
- commercial tenants temporarily having difficulty paying rent and other bills
- their landlords who, in turn, find it hard to make mortgage payments.
Next steps: Landlords and tenants should work together to agree a solution. If you cannot agree, it’s a good idea to get legal advice. Mediation or arbitration is another option — try the New Zealand Dispute Resolution Centre (NZDRC). You can register for subsidised arbitration on the NZDRC website.
Guidance for commercial property settlements — Ministry of Justice
COVID-19 lease disputes — New Zealand Dispute Resolution Centre
Business debt hibernation
What it is: Support to place existing debts on hold for up to seven months. This involves agreeing a new repayment plan with your creditors, eg reduced payments or delaying payments.
You also get government protection against creditors taking insolvency action against you for:
- 1 month while you agree a new repayment plan
- 6 months after agreeing new repayments.
You must still repay your debts in full.
Who can get it: Businesses and other organisations with both:
- existing debt
- reduced income due to the COVID-19 pandemic.
Eligible business types include:
- companies
- partnerships
- trusts
- societies.
Deadline to apply: No official deadline. But it’s important to notify the Companies Office and start talking to your creditors as soon as possible.
How to apply: Fill out the relevant form and send it to the Companies Office. Begin negotiating with your creditors — at least half must agree.
For more information, links to forms, and an online tool to check if you are eligible, check out our page on debt hibernation:
Also consider: Support available to businesses at risk of insolvency due to COVID-19, or facing difficulties complying with their legal obligations.
Law changes to help businesses — Companies Office
