COVID-19 – New Assistance Available

COVID-19 – New Assistance Available

COVID-19 – New Assistance Available

With Auckland being placed into a Level 3 lockdown, the Government has made announcements about extended assistance.

Resurgence Wage Subsidy

The Government has announced that they will extend the wage subsidy scheme again, this time for a period of two weeks to cover Auckland’s lockdown.  As we have already had the Wage Subsidy and the Wage Subsidy Extension, the new scheme has been called the Resurgence Wage Subsidy.

The scheme is available nationwide, regardless of where your business is situated. The rules are very similar to the first extension scheme.

  • A business must have had, or is predicting to have, a revenue drop due to COVID-19 of at least 40 per cent;
  • The revenue drop applies for any consecutive period of at least 14 days between 12 August and 14 September, compared with last year.

Applications are due to open through the Ministry of Social Development on Friday 21 August at 1pm. You can see more detailed information here.

Leave Support Scheme

The Leave Support Scheme is designed to assist businesses who have employees who cannot work due to:

  • having COVID-19, or having had contact with someone who does and are self-isolating; or
  • are in the category of people at most risk of contracting COVID-19; or
  • are living with someone who is in the category of people at most risk of contracting COVID-19.

Qualification criteria have been relaxed and the revenue test will no longer apply. Again, applications open at 1pm on 21 August 2020. Detailed information is available here.

Mortgage Repayment Holiday

The Government has announced that mortgage holidays will be extended out until March 2021.

The scheme does not apply automatically and mortgage holders will still need to make a formal application with their bank.

The banks have full information on their websites.

Holidays are usually eagerly awaited, but we advise caution with this type of holiday. Interest will continue to accrue on these loans and the repayment period will be prolonged as a result. It’s like kicking a can down the road and should really only be contemplated as a last resort. We notice that the banks are now referring to the scheme as a home loan repayment deferral which is a more accurate description.

There are other options, including reducing repayments to minimum payments, extending your loan term or switching to interest only for a period.

 

We will continue to keep clients updated with further announcements. If you are uncertain whether you qualify for support, please don’t hesitate to get in touch.

Angus is the CEO and founder of Generate Accounting.