COVID-19 news and information

COVID-19 commentary and updates

07 Apr 2020

COVID 19 - Temporary Companies Act Changes Announced

On 3 April, the government announced they will be introducing temporary new legislation to help businesses...

06 Apr 2020

COVID-19 Government announces essential workers leave scheme

On 2 April, the government announced an essential workers leave scheme. Broadly, this scheme expands...

31 Mar 2020

COVID-19 communicating in times of crisis

These last few days have been hard and will continue to be so for a while yet, as we all figure out what...

27 Mar 2020

Tax Talk | Further relief package details

Now that more information is available, we hope that this issue of Tax Talk will help answer some of...

26 Mar 2020

COVID-19 tax due dates - what to pay | Tax Talk

While it may seem the world is falling apart, income tax payments continue to fall due.

26 Mar 2020

COVID-19 wage and leave package update | Tax Talk

In the last few days, the government has updated their relief package and further clarity has been provided...

26 Mar 2020

COVID-19 Frequently Asked Questions

The government has acted quickly and decisively, ensuring that New Zealanders can concentrate more on...

20 Mar 2020

COVID-19 action checklist

Download this checklist covering the actions employers should be taking to keep their staff safe & informed...

20 Mar 2020

COVID-19 decision making tools

We have put together this checklist to help identify areas you may need to attend to.

20 Mar 2020

COVID-19 wage subsidy process

Wondering how the wage subsidy works? We have provided a process diagram and definitions.

20 Mar 2020

COVID-19 HR responsibilities

With the evolving COVID-19 situation the Baker Tilly Staples Rodway HR team have developed a plan that...

20 Mar 2020

COVID-19 government wage & leave package

As you will no doubt be aware, on Tuesday the Government announced a number of measures to assist businesses...

20 Mar 2020

COVID-19 financial considerations

The government is expecting a recession and expect this to impact New Zealand more significantly than...

20 Mar 2020

COVID-19 resources for employers

As New Zealand and the rest of the world responds to COVID-19, it is paramount that we as a nation take...

18 Mar 2020

Cashflow on tap: Provisional tax relief in the wake of COVID-19 and drought

Managing cashflow becomes paramount in an uncertain environment. Right now, a few folks will be trying...

18 Mar 2020

Building business resilience to coronavirus - what are your options?

Amid the uncertainty created by the coronavirus (COVID-19), including how long the effects will be felt,...

18 Mar 2020

Remote access in a disaster

Is your business prepared for the unthinkable?The COVID-19 virus has caused a real threat to business...

18 Mar 2020

Small business or all business

We were pleased to see the government move quickly with relief measures for the COVID-19 pandemic.

17 Mar 2020

Tax Talk | March 2020 | Government to the Rescue!

The government has released a $12.1 billion relief package in an attempt to mitigate the worst economic...

Our response

  • Our offices are now working from home. We have contingency plans prepared to ensure we can continue to service our clients at this unprecedented time. We continue to be available through email, over the phone and on Microsoft Teams.
  • The physical and psychological well-being of our clients, staff and contractors is a top priority.
  • Our meetings will be held via phone, or apps like Teams or Skype.
  • Your data is secure. Our IT engineers already have robust and secure systems for our team working remotely.
  • For the time being we will not be hosting or attending any events. We will reassess often and notify you if that changes.
  • We will only share thoroughly verified, accurate information from credible sources and will host this here on our website.
  • For further information and ongoing updates please check the Ministry of Health website or the official COVID-19 website.

DISCLAIMER: Our team is dedicated to helping you continue with business as usual, as much as you can. Information on government help is changing constantly and within hours of articles being added, the specifics may be out of date or only partially accurate. While we endeavour to keep this website accurate and current, our top priority is providing our clients with dedicated and relevant personal advice. If you need specific and up-to-date information, please seek help from your usual advisor directly.

No liability is assumed by Baker Tilly Staples Rodway for any losses suffered by any person relying directly or indirectly upon any article within this website. It is recommended that you consult your advisor before acting on this information.

COVID-19 Frequently Asked Questions

Do you have a business question?

Please use our form to ask any questions you may have as a business owner or employer, check in regularly, as your question may be added to our FAQ (your name will not be shared).

Where do I find information about the government's economic response package and eligibility?

The government has provided this information on the Business New Zealand website.

You will also find some useful resources in our News section.

What businesses are considered 'essential services'?
Please refer to the official website which outlines these services.

https://covid19.govt.nz/government-actions/covid-19-alert-level/#essential-businesses

I'm in the primary sector (food production), and 'essential service' - can we just work as normal?
No, there are strict MPI rules in place and a series of questions you have to be able to answer. The expectation is that you must adapt your way of working/operations/supply chain to minimise spreading the virus. You must register with MPI and be able to answer a series of questions. There will be an online registration process on the MPI website soon. Keep checking in there.
We're a business with 'essential workers' - some who are unable to work due to be being vulnerable, sick or otherwise unable to work due to COVID-19. Can we apply for the wage subsidy for them?

No. There will be a new Essential Leave Scheme available as of Monday 6 April 12pm. The scheme is similar to that of the wage subsidy but enables businesses that may not qualify for the wage subsidy to be able to support their essential workers. The criteria and details can be found here: https://www.beehive.govt.nz/release/essential-workers-leave-scheme-established

How do I measure whether revenue has decreased by at least 30%?

A business must experience a 30% decline in:

  • actual revenue, or
  • predicted revenue and
  • that decline is related to COVID-19

One month’s revenue must be compared against the same month the previous year.   If you are a new business (i.e. less than a year) revenue can be compared against a previous month that gives the best estimation of revenue decline.  

Revenue means the total amount of money earned from its normal business activities, before expenses are deducted.

Practically this means you will need to measure your revenue the same way each month to establish a decline.

How do I take active steps to mitigate the financial impact of COVID-19’?
  • activate your business continuity plan

 Seeking advice and support from:

  • Baker Tilly Staples Rodway
  • your bank
  • the Chamber of Commerce
  • a relevant industry association
  • the Regional Business Partner programme
Do I have to pay FBT for using my work vehicle during lockdown if using it to access essential services/I am an essential service?

Usual FBT rules apply during this time; if you previously paid FBT, then you are probably going to be required to continue to pay FBT. FBT on a motor vehicle arises on the basis a vehicle is available for private use, not whether a vehicle is actually used for private purposes. Home to work travel is a private use. 

FBT can be complex, especially where vehicles are provided to enable staff to provide services to the operation of plant and machinery, the supply of energy or fuel or emergency services to the health and safety of the public. For non-essential workers there may be scope to argue their car is not available because of the lockdown. We recommend discussing any specific details with your regular advisor.

How does the wage subsidy work; how do we receive the funds?
The Wage subsidy will be received by business as lump sums into their bank accounts being $7,029.60 for a full-time employee and $4,200 for a part time employee.  These subsidies are only to be used for wages. Payments to employees are then just treated as normal salary and wages and PAYE, and other payroll deductions will need to be deducted as normal. Your accountant can help with how to setup codes in the accounting system for processing the receipts of wage subsidies and your Payroll team can assist with payroll. Our clients are welcome to call us with any queries.
If I receive the Wage Subsidy, do I have to top up the amount I pay to employees pay to 80% of their ordinary wages?

You must make best endeavours to pay employees a minimum of 80% of their wages ‘ordinary’ wages and salary for the named employees for the subsidised period. Best endeavours is not defined, but clearly business conditions can change and events regarding COVID-19 are always evolving and businesses need to respond. You must retain the employees named in your application and cannot unlawfully compel or require them to use their leave entitlements for the period you receive the subsidy.

At a minimum, the government expects the full value of the subsidy (after deducting PAYE etc) to be passed on to workers.

Note, you must have discussed your application with the named employees and employees must have consented to the application and any changes to their working arrangements (including reduced hours or wages).

I think I may need to repay some of the wage subsidy? What do I do?

You will need to repay some or all the COVID-19 Wage Subsidy if:

  • you no longer meet the criteria for the subsidy
  • you’re not meeting your obligation to use the subsidy to retain and pay your employees
  • you’ve received insurance (eg, business continuity insurance) for any costs covered by the subsidy
  • you provided false or misleading information in your application.

You can check the obligations here: 

Obligations if you applied before 4pm on 27 March

Obligations if you applied on or after 4pm on 27 March

You can also make a repayment if you think you need to pay back some or all of the COVID-19 Wage Subsidy. This could be because you were overpaid or made a mistake on your application.

How to repay the subsidy

You can email COVID19subsidy_overpayment@msd.govt.nz with your:

  • business name
  • IRD number
  • New Zealand Business Number (NZBN), if you have one
  • phone number
  • email address
  • postal address

You’ll also need to tell them:

  • the amount you need to refund
  • why you want to refund it.

Once they’ve received your email, they’ll contact you to confirm the refund amount and how you can make the repayment.

Where an employer has received the wage subsidy under the 30% decline and has $585 per week for employees - what amount gets paid as wages?...

...Does the employer pay gross $585 to the employee via payroll, is the $585 net or is it expected they will pay regular salary?

 

To receive the subsidy, the employer must commit to pay 80% of the employee’s usual wage over the subsidy period (wages are subject to PAYE in the usual way). The amount paid to the employee is not linked to the $585 the employer receives.

Am I entitled to the full $350 wage subsidy if I pay my part time employee less than that?

As long as the person is a permanent part timer, there is an entitlement to the subsidy. The purpose of the subsidy is to enable people to remain employed, rather than be made redundant.

The full $350 wage subsidy can be claimed, even if the ordinary pay of your part time employee is less. However, it is expected the employee would be paid their full wage and any surplus would be used to support the wages of other employees.

 

NOTE: a permanent part timer includes contractors, casual staff or fixed term workers if they were scheduled to work during the lockdown.

If I have contractors, can I still apply for the subsidy?

Generally contractors would apply in their own right. If circumstances make this difficult, we recommend confirming the number of hours worked, and the conditions of the contract for aspects such as guaranteed hours of work. We can assist with contract reviews.

This will be the same for employees on commission, seasonal workers and casual employees.

How do sole traders / Partnerships / Trusts apply for an NZBN?

You will need to apply for an NZBN under 'your trust name' which you can do here:
https://www.nzbn.govt.nz/get-an-nzbn/get-your-nzbn/

You will need to scroll down and click “Operating a Trust? Get your NZBN here”

  • You can then start an online application
    • You will need Trustee Details
      • Full Names, date appointed and may need to provide a copy of an identity document for one of the trustees (NZ Driver licence or passport)
    • Proof of trustee status (Trust Deed) – this must match the names of the trustees above
    • RealMe login (or you can create one)
    • Then set up a user account
What happens if I need to make a staff member redundant, but I have received the subsidy for that person?

We understand if the subsidy was obtained in good faith there will be no adverse consequences, apart from most likely repaying the subsidy. However, ensure good records are kept to support your position.

Please also contact us, our Human Resources department will be able to assist with employer obligations in respect of redundancies.

How do employers treat the subsidy for tax purposes?
  • The subsidy is not subject to GST
  • PAYE and other payroll deductions such as Kiwisaver must be withheld when the subsidy is on-paid to employees (i.e. it is the net amount the employee receives).
  • The subsidy is not taxable income to an employers on receipt
  • There is no tax deduction for the subsidy when its paid out to employees
How do self employed people treat the subsidy for tax purposes?
  • The subsidy is not subject to GST
  • The subsidy is taxable (because no wage/salary is paid)
If I am a charity or organisation not operating in a company. Can I still apply for the subsidy?

The subsidy is broadly available and is designed to support employers to retain employees regardless of structure.

What evidence do I need to have to support my claim?

As claims can be audited, please note the following: 

  • In making the claim you are declaring you meet the eligibility criteria
  • We recommend you document you have sought advice from third parties (banks etc)
  • Document internal procedures taken to reduce the financial effects of COVID-19 on your business
  • Keep accurate records evidencing how you calculated a 30% reduction in revenue

Any claims made in error may be subject to repayment.

I accidentally left some people off my wage subsidy application what do I do?

We recommend contacting MSD directly if you have made any errors.

As the $150,000 cap has been removed, if you originally applied for a larger amount, MSD will automatically top you up.

You are also able to apply for an additional wage subsidy if you originally limited your application $150,000 but needed more.

Can full time investors get any kind of wage subsidy or any leave help during COVID-19 as they are also paying tax?

Unfortunately full time investors are unlikely to meet the criteria for relief under the government’s wage subsidy package.

However, there are several other items where full time investors may obtain relief. These include:

  • The ability to claim a deduction for assets purchased between 17 March 2020 and 16 March 2021 with a value of less than $5,000
  • The ability to claim depreciation on commercial and industrial buildings from the 2021 year
  • The ability to file an estimate of 2020 provisional tax where this is expected to be lower

All the above are subject to specific criteria, please discuss this with your advisor.

How long does it take to receive the subsidy?

Current indications are between 2 and 7 working days.

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