7/7/2020
COVID-19 Wage Subsidy
|
New Zealand
COVID-19 Wage Subsidy
A practical guide to Wage Subsidy support for
New Zealand businesses
https://www.pwc.co.nz/services/tax/covid-19-wages-subsidy.html
1/17
7/7/2020
COVID-19 Wage Subsidy
Eligibility checklist
Available to New Zealand employers (including limited liability companies, registered
charities, incorporated societies etc.), contractors / sole traders / the self-employed /
partnerships etc.
Your business must be registered and operating in New Zealand.
Where claiming for employees, they must be legal y working in New Zealand.
Due to COVID-19, your business must have experienced, or predict to experience, a
minimum 30% decline in revenue.
Your business must have taken active steps to mitigate the impact of COVID-19.
You must commit to making your best efforts to both retain employees and pay them a
minimum of 80% of their normal income for the subsidised period.
Practical steps
https://www.pwc.co.nz/services/tax/covid-19-wages-subsidy.html
2/17
7/7/2020
COVID-19 Wage Subsidy
https://www.pwc.co.nz/services/tax/covid-19-wages-subsidy.html
3/17
7/7/2020
COVID-19 Wage Subsidy
Are you eligible?
Calculate decline in revenue of 30% - do a comparison of current
month vs. prior year (or current year for new businesses) -
save
this calculation.
Predicted revenue - what is this based on and are the
assumptions reasonable ie. cancel ed bookings, cancel ed
orders, being forced to close for 4 weeks.
Does the revenue decline directly relate to COVID-19?
Document this
Can you make "best efforts" to retain staff over a 12 week
period? Prepare a cashflow forecast - for the 12 week subsidy
period at a minimum. Consider dropping wages to 80%.
Take active steps to mitigate the impact of COVID-19: Cal or
email your bank, advisor, industry association -
Document this
https://www.pwc.co.nz/services/tax/covid-19-wages-subsidy.html
4/17
7/7/2020
COVID-19 Wage Subsidy
https://www.pwc.co.nz/services/tax/covid-19-wages-subsidy.html
5/17
7/7/2020
COVID-19 Wage Subsidy
Things to consider
The size of your workforce
What level of wages can your business afford to maintain. Can
you maintain the 80%?
Communicate to employees that you wil apply for the wages
subsidy. Whilst employee consent is no longer required since the
national emergency was declared, it is recommended that you
notify employees.
Taking active steps to mitigate the risk of COVID-19 doesn’t stop
here - continue to document the steps as you work through them
Consider legal requirements
You don’t need evidence to apply online, but be aware you might
be audited. We recommend documenting al the evidence before
applying.
When making decisions and renegotiating wages are you acting
in good-faith?
https://www.pwc.co.nz/services/tax/covid-19-wages-subsidy.html
6/17
7/7/2020
COVID-19 Wage Subsidy
https://www.pwc.co.nz/services/tax/covid-19-wages-subsidy.html
7/17
7/7/2020
COVID-19 Wage Subsidy
https://www.pwc.co.nz/services/tax/covid-19-wages-subsidy.html
8/17
7/7/2020
COVID-19 Wage Subsidy
Apply online
Logon &
apply online
What you need to apply:
Business IRD Number
IR Customer Name
Business Address
Contact Name
Contact Email
Contact Mobile
Bank Account number
Employee details: First & Last name, date of birth, IRD number,
employment status ful time/parttime
Before you click submit, print a copy.
https://www.pwc.co.nz/services/tax/covid-19-wages-subsidy.html
9/17
7/7/2020
COVID-19 Wage Subsidy
For large employers, file upload is available. Alternatively
consider using the PwC BOT service.
https://www.pwc.co.nz/services/tax/covid-19-wages-subsidy.html
10/17
7/7/2020
COVID-19 Wage Subsidy
https://www.pwc.co.nz/services/tax/covid-19-wages-subsidy.html
11/17
7/7/2020
COVID-19 Wage Subsidy
I have applied - what now?
The government is aiming to have the funds to you in 5 days
You wil get a text and email once the payment is made
You wil receive the payment in one lump sum
You need to continue to pay your payrol to the employees you
applied for the subsidy for. You should have recalculated wages
already (if you are dropping to 80%), on-pay this new amount to
employees.
Continue to update your cashflow on a weekly basis at a
minimum. Cashflow is key!
Ensure you have documented your approach to claiming the
subsidy.
https://www.pwc.co.nz/services/tax/covid-19-wages-subsidy.html
12/17
7/7/2020
COVID-19 Wage Subsidy
https://www.pwc.co.nz/services/tax/covid-19-wages-subsidy.html
13/17
7/7/2020
COVID-19 Wage Subsidy
Remember
You need to continue to file your PAYE returns as normal.
However, there are options for tax payment flexibility if discussed
with Inland Revenue.
You may be audited, and if you provide false or misleading
information, you may be investigated for fraud
You need to notify the government if circumstances change that
affect your eligibility.
You wil have to repay any amount to which you are not entitled.
Consider whether an independent sign off by PwC on the validity
of your claim would be of value.
Guiding principles and how we can help
https://www.pwc.co.nz/services/tax/covid-19-wages-subsidy.html
14/17
7/7/2020
COVID-19 Wage Subsidy
Wage Subsidy support was introduced rapidly in response to the Covid-19 Alert Levels 3 and 4.
With no legislative framework underpinning the scheme it is important that employers
understand the core principles to guide their decision making.
Those guiding principles are that claimants:
Apply their “best efforts” to ensure employees retain their employment.
Provide accurate information to support a valid claim.
Ensure that if circumstances change and they cease to be eligible in ful or in part, that this
is communicated with MSD
Apply their "best efforts" to pay employees at least 80% of their normal salary and wages
where possible.
Act in good faith with their employees.
The key rationale for this initiative is that the Government wants to support businesses and
provide job security to employees through this unprecedented time.
We can assist with:
Your wage subsidy application
Employee communication protocols
https://www.pwc.co.nz/services/tax/covid-19-wages-subsidy.html
15/17
7/7/2020
COVID-19 Wage Subsidy
Providing an independent sign-off for your claim
Planning for the future
× Hide
Contact
Scott McLiver
Jan Gatley
Sandy Lau
Partner, Auckland,
Partner, Waikato,
Partner, Wel ington,
PwC New Zealand
PwC New Zealand
PwC New Zealand
+64 21 820 945
+64 21 190 7011
+64 21 494 117
Phil Fisher
Geof Nightingale
Partner, Wel ington,
Partner, Auckland,
PwC New Zealand
PwC New Zealand
+64 27 462 7505
+64 21 940 346
https://www.pwc.co.nz/services/tax/covid-19-wages-subsidy.html
16/17
7/7/2020
COVID-19 Wage Subsidy
About us
Contact us
Alumni
Careers
Our Leaders
Our offices
Our
Media centre
Leadership
teams
© 2017 - 2020 PwC. Al rights reserved. PwC refers to the PwC network and/or one or more of its member firms,
each of which is a separate legal entity. Please see
www.pwc.com/structure for further details.
Privacy
Cookies info
Legal disclaimer
Code of conduct
About site provider
https://www.pwc.co.nz/services/tax/covid-19-wages-subsidy.html
17/17
