The wage subsidy for NZ employers
The Government's wage subsidy is available for all employers that are significantly impacted by COVID-19 and are struggling to retain employees as a result.
The main details of the wage subsidy are as follows but there are still details being worked out. We'll keep you updated.
The 12-week wage subsidy applies to NZ businesses that are significantly affected by COVID-19, and the recent measures to control it. This includes:
- Existing businesses
- sole traders
- registered charities
- non-government organisations
- incorporated societies
- New businesses less than a year old.
Are all employers eligible to apply?
- Businesses must be registered and operating in New Zealand.
- Employees must be legally working in New Zealand.
- Your business must show a 30% decline in revenue over a month compared to the same period last year. For new businesses this would be a ‘similar period’.
- The wage subsidy applies to employees who can no longer work, it is not for staff who can work from home.
- You must make best efforts to retain employees and pay them a minimum of 80% of their normal income for the subsidised period.
How much is the subsidy?
- Full Time employee (20 hours of more) - $585.80 per week
- Part time employee (less than 20 hrs) - $350.00 per week
The payment will be made as a lump sum for a period covering 12 weeks per employee. Which equates to $7,029.60 for a full time employee and $4,200 for a part time employee.
The Government now has removed the cap of $150,000 per business. (If you have already applied you do not need to reapply).
The payment is exempt from GST exclusive for employers. However, it is subject to the usual PAYE, Student Loan, KiwiSaver deductions for employees.
The subsidy is for wages only, to help keep staff employed and also aims to help ensure your business viability.
To apply you’ll need your IRD number, business number, name and address, the names of your employees, and your employer IRD numbers, contact details for your employees and your business.
These are tough times for businesses. Don’t do it on your own. We're here to help you navigate the coming months. If you've got questions about the wage subsidy and if your business is eligible, then please contact us on 03 474 0475.