- If you are having cash-flow difficulties contact your bank at the earliest opportunity. It’s better to front-foot these challenges. The major banks may announce further assistance packages in the weeks ahead, at the moment it is case by case
- Tax payments, as above, if you are having cash-flow difficulties talk to the IRD at the earliest opportunity (www.ird.govt.nz or 0800 377 774) to make a payment plan
- Newmarket, along with several other BIDs, presented to the Council’s Governing Body and Mayor this week, and requested council consideration / assistance in their Annual Budget for the business community to help get through an economic downturn
- Newmarket-based Business Mentors (www.businessmentors.org.nz) provide expert business guidance
- The NBA will be maintaining communications so that members and consumers have the most up-to-date information available. Our above-the-line promotions across all of our own, and third party, channels and platforms will continue
- Stay on top of, and encourage staff to stay on top of, Ministry of Health advice
- It is uncertain how far coronavirus will spread in New Zealand: adjustments as to how it is being managed in the workplace will likely be necessary
- Communicate with and educate staff about how coronavirus is being managed in the workplace; provide regular updates where possible
- Whether an employee should be paid requires an assessment of the specific circumstances. For example:
- Can the employee work from home?
- Does the employee have coronavirus?
- Is the employee caring for a person that has coronavirus?
- Is the employee expected to voluntarily self-isolate?
- Is the employee caring for a person that has to voluntarily self-isolate?
- Has the employee, in accordance with the Ministry of Health guidelines, been instructed to stay away from the workplace?
- Consider whether an agreement can be reached with the employee regarding how their absence from the workplace will be treated
- The types of payments that should be considered are:
- Sick leave
- Annual leave (accrued or in advance)
- Discretionary leave
- Unpaid leave – however note the point below in bold
- If employees are not being paid to self-isolate, there is a substantial risk that they will not voluntarily self-isolate.
- Legal advice based on the specific circumstances is recommended
- Robbie Bryant, Senior Associate, SBM Legal: email@example.com / 021 940 38
Newmarket Business Awards and ANZAC Day
Given the recent developments and the uncertainty of the next few months we have made the decision to postpone the 2020 Newmarket Business Awards until, at least, later in the year. We did not make this decision lightly and believe that if we postpone the awards, we, as a team, can focus on other ways to support you, our members. We understand you will not be overly inclined to commit valuable time to completing an entry when businesses universally are in for some very serious challenges. We thank those of you who have already submitted entries and we will be in contact with you about keeping your entry until later in the year.
This is also the same situation for our annual ANZAC day commemorations. Although this is a very important community event, we feel that the time and resources required to deliver it would be better spent elsewhere.
The Government’s COVID-19 Response Package:
Yesterday the Government announced a $12.1 billion (4% of GDP) COVID-19 assistance package, a bold response to an unprecedented situation with further phases expected to come. This is certainly not a panacea, but every little bit will help.
The package for business includes:
- Wage subsidies for businesses affected by COVID-19 in all regions and sectors for 12 weeks ($5.1bn)
- Business tax changes to free up cash flow ($2.8bn), including re-introducing building depreciation, a provisional tax threshold lift, and writing off interest on late tax payments
- Smaller initiatives including a self-isolation support, a worker redeployment package, and an aviation support package
- Additionally, an increase of $25 per week for benefits.
What is likely to be relevant for Newmarket businesses:
- These will support your business if you are impacted by COVID-19 and face laying off staff or have to reduce their hours because of COVID-19. If you are an employer, contractor, sole trader or self-employed you may qualify for this
What it offers
- The wage subsidy applies for up to 12 weeks if your business has suffered a 30% decline in revenue over any month between January 2020-June 2020 compared to last year. The subsidy is $585 a week for full-timers, $350 a week for part-timers, available to all employers and self-employed. Applications can also be made on the basis of forecast revenue loss. However, no single business is able to claim more than $150,000.
- The Government will also provide financial support for those who need to take COVID-19 related sick leave, or who have to go into self-isolation, or those caring for people with it/or people in self-isolation. This will last up to eight weeks. Again the amount is $585 a week for full-timers and $350 a week for part-timers. This support will be paid directly by the Ministry for Social Development to employers who have made applications. Self-isolation payments are not available to people who leave New Zealand after March 16.
- Your business must be registered and operating in New Zealand
- Your employees must be legally working in New Zealand
- Your business must have experienced a minimum 30% decline in actual or predicted revenue over the period of a month when compared with the same month last year, and that decline is related to COVID-19
- Your business must have taken active steps to mitigate the impact of COVID-19
- You must make best efforts to retain employees and pay them a minimum of 80% of their normal income for the subsidised period.
- More information on the qualifying definitions is available here.
Applying for either payment is easy:
You apply online for either the COVID-19 Wage Subsidy or COVID-19 Leave Payment
When you apply you will need to give them:
- Your IRD number
- Your business name
- Business address
- The names of your employees
- Your employee IRD numbers
- Contact details for your business and your employees
Processing and approving applications will be done as quickly as possible and they aim to make payments five working days after they have all the information they need from you – but this will depend on the volume of applications received.
Business cash flow and tax measures
There are a number of business cash flow and tax measures that have been announced, including:
- Giving IRD discretion to remit use-of-money interest (UOMI) for customers significantly adversely affected by COVID-19.
- Increasing the provisional tax threshold from $2,500 to $5,000 from 2020/2021.
- Increasing the small asset depreciation threshold from $500 to $1,000 — and to $5,000 for the 2020/21 tax year.
- Allowing depreciation on commercial and industrial buildings from 2020/2021.
- Removing the hours test from the In-Work Tax Credit (IWTC) from 1 July 2020.
More information on the business cash flow and tax measures can be found on the Inland Revenue website here.
Wider $12.1 billion package
There are further parts to the wider $12.1 billion package that you may be interested in, including income support, and further investment in the health response. More information on the wider package can be found on the Treasury website here.
COVID-19 Pandemic Preparedness Plan (link)
Now is the time to understand what we can do, as individuals and businesses, to protect ourselves, our families, and our communities. Microbiologist Dr Siouxsie Wiles has created this superb pandemic plan template that you can be utilise for your business, here.
Other online support
There is a range of support available for businesses. Here are some useful links:
- Government Portal for COVID-19
- Ministry of Social Development
- Ministry of Business, Innovation and Employment (MBIE)
- Ministry of Health
- Vend Blog on Covid-19 and Retail
- Newmarket-based Business Mentors
From the NBA’s perspective we are reviewing our focus on a daily basis. We will maintain our usual above the line marketing activities promoting the precinct across all of our channels. We are planning additional campaigns with a “support local” theme and will also promote, across third-party platforms, the online version of NEWMARKET. magazine which is e-commerce enabled so consumers can click through to make purchases.
We intend to run a series of webinars to support members on topics that will likely include financial resilience/ surviving a downturn; social media and e-commerce optimisation; knowing your legal obligations from an employment perspective; and others to be announced. If you are struggling with OPEX costs such as rent, it would be worthwhile having an open and honest conversation with your landlord to see what options may be available.
The NBA team is here to help, please get in touch if you have any questions.
We have to look out for each other first and foremost.