Trust in the Future: COVID-19 Financial Support Programs in NL

I. NOW: wage costs reimbursement

Target group

This facility is meant for businesses with staff that expect to have a turnover loss of at least 20% within the coming three months. Extraordinary circumstances causing the turnover loss do not have to be demonstrated.

Facility

The Government of the Netherlands aims to prevent the loss of jobs and income due to the Corona Virus by means of the ‘Temporary Emergency Measures Employment Bridging’ (NOW). Employers coping with significant turnover loss are eligible to receive a reimbursement in wage costs. The facility aims to keep workers employed for as much as possible, even those who are not entitled to a continued salary pay. The facility is expected to open from 6 April 2020. The application period will run up and to 31 May 2020. Employers will receive an advance from the Executive Institute for Workers’ Insurances (UWV) if their application is approved.

Conditions

From 1 March 2020, businesses that have a turnover loss of at least 20% within three months can apply retroactively for a reimbursement of up to 90% of the wage bill proportional to the loss in turnover. For example, in case of turnover loss of 50%, the reimbursement will be 45% of the wage bill. Employers are required to continuously pay workers their ordinary salary and not file for dismissal based on business- economic factors during the period of reimbursement.

The expected turnover loss needs to be submitted with the application. The UWV will grant an advance of 80% in case it renders a positive decision, spread across 3 time-periods. The first part of the advance will be paid out within 2 to 4 weeks after the application.

An application for confirmation of the subsidy must be filed within 24 weeks after expiry of the period over which the NOW has been granted. For this, in principle, no accountant’s statement is required. Afterwards UWV will issue a final statement, which can either be more or less than what was expected at the moment of first filing.

Calculating turnover loss

In order to determine the height of the turnover loss, the total turnover from the year 2019 must be divided by 4. The resulting number then needs to be compared to the turnover numbers in March-April-May 2020. For concerns only aggregated turnover loss will be taken into account. Businesses that only started during the year 2019 must start counting from the month of first entering into business until February 2020. The accumulated turnover over that period must be recalculated to 3 months. The resulting amount will be compared to the numbers of 2020.

Determining the wage bill

To determine the wage bill the UWV will refer to the information submitted in the wage tax return. It is therefore important that employers file their wage tax return with the Tax Authority on time. The social security wage will be taken as a basis. To this a 30% raise will be added to account for employers’ contributions. The refundable wage is capped to EUR 9.538 salary per month. The wage bill in the subsidy period will be compared to that of January 2020, as registered with the Tax Authority. The wage bill of November 2019 will be taken into account in case the latter’s still missing. Changes in the wage bill after 15 March 2020 will not be considered.

How to apply

The application for NOW-compensation needs to be submitted at UWV from 6 April up and to 31 May 2020 as forecasted. Eligible businesses receive an advance within 2 to 4 weeks. A wage tax number is required in order to apply successfully.

II. Tozo: income support and company credit

Target group

This facility is meant for independent- and or self-employed entrepreneurs, including freelancers, who are financially constrained due to the Corona Virus measures.

Facility

The facility is based on the already existing support scheme for self-employed persons (Bbz), but is processed and provided more quickly. It has temporary lenient conditions given the abnormal circumstances due to the Corona Virus. The ‘Temporary Bridging-Arrangement Independent Entrepreneurs’ (Tozo) has been created in order to provide income support to self-employed persons. This benefit for livelihood maintenance supplements your income up to the social minimum for a maximum period of three months. Through this facility, independent entrepreneurs are eligible to receive up to EUR 1.500 per month and acquire loans for working capital to alleviate liquidity problems.

The temporary arrangement involves the following:

No viability check, which enables expedient processing of the application;

No requirement to refund the income support for livelihood maintenance;

No wealth- or partner checks;

Provision of income support within four weeks for a period of up to three months, with the possibility of advances;

Amount of income support depends of current income and counts up to EUR 1.500 for married couples and EUR 1.050 for single people from the age of 21. During the application, your municipality will request:

- how many profits you expect to receive in the coming months?

- whether you have any additional income next to that gained from your business?

Expedited procedure also applies to loan applications for working capital of up to EUR 10.157 against a 2% interest rate;

Maximum period of the loan is 3 years. No repayment required until 1 January 2021;

Working capital may not be used to refinance existing loans;

One benefit and one loan per household.

Tozo remains valid for a period of 3 months for the time being, until 1 June 2020. The arrangement is executed by your municipality of residence and applies retroactively until 1 March 2020.

Conditions

The following conditions need to be fulfilled in order to qualify for the temporary arrangement:

Self-employed from the age of 18 until the retirement age;

Permanent and valid residence within the Netherlands;

Dutch citizen or equated person;

Businesses conducted within the Netherlands;

Fulfills all legal requirements for conducting business, including register in the Trade Register of the Chamber of Commerce;

Business initiated before 17 March 2020, 18:45 hours;

Employed in own business for at least 1.225 hours per year. For younger businesses, an average of at least 24 hours per week applies;

Residence in the municipality where the application is made;

Income below the social minimum as a cause of the Corona Virus measures.

CIS Management offers to assist in assessing whether your business qualifies for Tozo by filling in the relevant questionnaire on the website of the Ministry of Social Affairs and Employment (SZW).

How to apply

Support can be requested in the form of a supplemental benefit for livelihood maintenance and- or working capital. The facility is based on the already existing support scheme for self-employed persons (Bbz) executed by the municipality. You can file your application by means of a digital application form on the website of the municipality of your living residence (not business residence). Copies or your ID, bank statements, rulings, letters and household information are required to be submitted. Trade Register information will be consulted by the municipality on its own initiative.

III. TOGS: one-off EUR 4.000 grant

Target group

The facility is meant for small-and medium sized companies incurring damages due to forced closing, restricted gatherings and/or negative travel advices. Your business qualifies if it was registered with one of the designated business activities in the Trade Register on 15 March 2020 and fulfills all other criteria.

Businesses that fall within the delineation are the following:

Cinemas;

Hair- and beauty salons;

Travel agencies;

Driving school operators;

Saunas, tan salons, swimming pools, sport clubs- and events;

Certain private cultural institutions such as museums and theaters;

Event organization agencies;

Casinos;

Particular business groups in the non-food sector, such as retailers.

Important: those businesses whose main activity has been registered under a different than one of the above-listed SBI (Standard Business Index) codes, but nevertheless believe to qualify for the arrangement, may notify this to the executive authority.

Apart from this, it always remains possible to register for a change in the activity description in the Trade Register at the Chamber of Commerce (with retroactive effect). Proof of this may be requested. Please be aware that this does not automatically mean your business qualifies for the facility.

Facility

The ‘Grant Businesses Hit Sectors COVID-19’ (TOGS) supports businesses in sectors that have been directly hit due to the Corona Virus measures. Those who qualify acquire a one-off, tax exempt sum of EUR 4.000, to be freely used. Through this grant the Government of the Netherlands aims to support businesses that are in significant financial distress.

Conditions

The following conditions need to be fulfilled in order qualify for the arrangement:

The company has been established and was registered at the Trade Register on 15 March 2020;

The company has up to 250 employees at most. This is demonstrated by the registration details in the Trade Register;

The company’s main activity was registered at the Trade Register under one of the mandatory SBI-codes on 15 March 2020;

The company has a physical establishment in the Netherlands the address of which is registered in the Trade Register;

Non-hospitality businesses declare to have at least 1 establishment different from the owner’s private address;

The grant counts a one-off amount of EUR 4.000 per company (not per establishment);

While filing the application the company submits a corporate bank account number;

The company has not filed for bankruptcy;

The company declares to expect a turnover loss of at least EUR 4.000 in the period from 16 March up and to 15 June 2020;

The company declares to expect fixed costs of at least EUR 4.000 in the period from 16 March up and to 15 June 2020, even in spite of the use of other governmental support facilities;

The company declares not to have received more than EUR 200.000 governmental support within the current and past 2 years;

The company declares not be a government business.

How to apply

The application for the EUR 4.000 allowance is submitted online through the website of the ‘State Service for Dutch Businesses’ (RVO). A decision is rendered within 3 weeks, after which the allowance will be paid out within 1 week. Applications can be submitted until 26 June 2020.

For successful application the following is needed:

eHerkenning or DigiD

trade Register number

SBI-code of the company’s main activity

corporate bank account number

correspondence- and/or visiting address

contact details: name, phone-number and email

Important: a valid proxy is needed in case the application is submitted by an intermediary. A copy may be requested upon further inspection.

IV. BMKB: favorable loan conditions at accredited Dutch banks

Target group

BMKB is meant for businesses with up to 250 employees and a yearly turnover of up to EUR 50 million or a total balance of up to EUR 43 million.

Facility

The conditions applicable to the SME credit guarantee (BMKB) scheme have been relaxed to the benefit of businesses hit by the Corona Virus measures. This adjusted arrangement has entered into force from 16 March 2020. With it, companies may acquire credit from the bank under more favorable conditions.

Through this facility the Government aims to prevent companies from running into liquidity problems due to the Corona Virus situation. The Government offers partial security for businesses in the process of acquiring a loan. It increases the amount of credit payable.

Condition

The BMKB amounts to 75% of the credit provided. The surety offered by the Government amounts to 90% of this guaranteed credit;<

Personal surety is reduced from 25% to 10%;

Credit part for risk of the bank able to be in the form of a new loan, new current account credit of raise of existing current account credit;

Credit of up to EUR 1.5 million;

Running time of up to 8 quarters;

Means of repayment to be determined by the bank (either linear or at once);

No check on the shortage of securities

How to apply

Applications are submitted by one of the accredited banking institutions listed on the RVO website.

Source

https://ondernemersplein.kvk.nl/bmkb/

V. Taxes: postponement of tax payments against a low interest rate

Target group

Corona-troubled businesses paying taxes in the Netherlands.

Facility

An application for the postponement of tax payments may be made to the Tax Authority in case your business is in financial distress as a cause of the Corona Virus measures. This facility covers income-, corporate-, wage- and turnover (VAT) taxes. The Tax Authority will not levy a default penalty for delayed tax payments. You may also request a reduction of your preliminary assessment if you expect to receive lower profits.

Temporarily almost no collection rate

The collection rate which usually applies after expiry of the payment term will be reduced temporarily from 4% to almost 0%. This coves all tax debts. In addition, the tax interest rate will be reduced temporarily to 0,01%. This will apply to all taxes for which tax interest is due from 1 June 2020, excluding income taxes, for which the tax interest reduction will apply from 1 July 2020.

Conditions

Suspension may be requested for all income-, corporate, turnover (VAT) and wage tax assessments. This means you may file the request for postponement after the filing of your return and receipt of your assessment.

How to apply

Written applications need to be submitted to the Tax Authority. The request must be motivated in the accompanying letter. From this moment on the collection process will be suspended. The request will only be examined on substance afterwards. The processing time may surge due to the large amount of applications.

Source

https://www.belastingdienst.nl/wps/wcm/connect/nl/ondernemers/content/coronavirus-belastingmaatregelen-om-ondernemers-te-helpen

VI. Customs: terms-, license-, payment- and penalty relief

Due to the Corona Virus measures many businesses are not able pay their customs fees and adhere to other customs formalities. The Dutch Customs Authority supports those businesses with a package of facilities. It offers a case-by-case approach to companies in default of acquiring the prerequisite customs licenses. Next to this are possibilities for the suspension of payments and a lenient attitude towards the imposition of penalties.

Source

https://www.belastingdienst.nl/wps/wcm/connect/nl/douane_voor_bedrijven/content/corona-crisis-maatregelenpakket-douane-voor-ondernemers

In case you are interested in applying for one of the mentioned benefits or you are not sure whether you qualify – please get in touch with CIS Management and we will guide you through. Contact us. Our specialist will call you back asap.