Small Business Sector
Tax Relief
SARS TAX RELIEF IS NOT AUTOMATIC
If the company can afford the tax liability, the company is required to pay the full amount. Proof to be provided that company is unable (due to the effect of COVID-19) to pay the liability. Tax relief is aimed at distressed companies.
Contributions to UIF and SDL
Potential temporary reduction in employer and employee contributions to both UIF and SDL. Requirements are still to be confirmed.
Delay of payments of taxes
Relief Options | Requirements | |
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PAYE liabilities | Defer 20% of prospective PAYE liability over the next 4 months | Turnover ≤ R50 million |
Provisional Corporate income tax (CIT) | Defer a portion of prospective CIT payments without penalties or interest over the next 6 months | Turnover ≤ R50 million |
Subsidies and ETI payments
Relief Options | Requirements | |
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Subsidy provided | R00 subsidy per month for the next 4 months | Only for employees earning below R6500 |
SARS ETI payments | ETI refunds to be paid out by SARS to Companies monthly and not 6-monthly | Normal ETI rules apply |
Compensation fund
Relief options & claims | Requirements | |
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Effective 20 march 2020 | Compensation for occupationally Acquired COVID-19 Claims to use Code U07.1 |
Various reports, including: W.CL.1 and W.CL.14 Exposure & medical Questionnaire W.Cl.22(U07.1 as code) |
Online Claims -Compensations Fund: CompEasy (www.labour.gov.za)
Submission of manual claims – Compensation Fund: covid19claims@labour.gov.za or phone 0860 105 350.
Government funding
National disaster benefit (from UIF)
- Employer may decide (as direct result from COVID-19 pandemic) to close business from a period and send employees home.
- This constitutes a temporary lay-off. If the employer cannot pay his employees for this period. The employer can apply for the “ National Disaster Benefit” from UIF.
- This benefit will be at a flat rate equal to the minimum wage (R3500)
- Per employee for the duration of the shutdown, or a maximum period of 3 months, whichever period is the shortest.
- If an employee is ill, temporary lay-off or unemployment for longer than three months, the normal UIF benefits will apply.
Solidarity response fund
Fund is set up to assist with the prevention, detection, care for hospital or medical care and to support those lives have been disrupted by the pandemic. This is still a work in progress. How the administration of this fund will work is yet to be announced.
SMMEs SA
Growth and resilience fund | Debt relief fund | |
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Register business: http://smmesa.gov.za/ Online applications: Available from 2 April 2020 |
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Funding to be used for |
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Amount of financial assistance |
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Finance scheme |
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UIF Temporary employer/employee relief scheme (TERS)
UIF may fund distressed companies. May only be claimed if employees do not claim UIF themselves.
Email queries to: covid19ters@labour.gov.za
Applications: MosaB@ccma.org.za
Forms: inforTERS@labour.gov.za
Tourism relief fund
- Department of Tourism created a R2000 million relief fund.
- Various requirements to apply.
- Relief to be used for Hotels, resort properties, B&B’s, Restaurants, conference venues, professional caterers and tourist attractions, tour operators and travel agents.
Private Funding
Business Partners Ltd
Appointed as administrator for disbursing R1 billion donation made by Rupert Family to assist SME businesses affected by the COVID-19 pandemic and their employees.
Information and application forms will be available on the website www.businesspartners.co.za, by Wednesday 1 April 2020.
SAFT (South African Future Trust)
Established by Nicky and Jonathan Oppenheimer.
A R1 billion fund available from 3 April 2020 to South African businesses impacted by the coronavirus. The money will be paid out directly to employees of small, medium and micro-sized businesses as interest-free loans over a 5 year term.
Employees themselves will not be liable to pay the money back, but companies will be.
It is expected that the typical loan amount per employee will be around R750/week, for a period of 15 weeks.
The scheme is currently available to clients of the four banks, ABSA, Nedbank, Standard Bank, FNB. SMMEs need to apply through their main bank.
TERMS:
- Interest-free for a five-year period
- Subordinated to other pre-existing debt
ELIGIBILITY CRITERIA FOR SMEs:
- Annual turnover below R25 million
- Must have been trading for at least 24 months
- It must have been a sustainable business at 29 February 2020
- It must have been adversely affected by the Covid-19 outbreak
NEEDE DOCUMENTATION:
- Company identification: Registration number (for CCs), Master’s reference number ( for trusts), ID number and address ( for sole proprietors)
- PAYE number
- Income tax number
- Confirmation of employment status of employee
Banking sector
Standard Bank – businessassisst@standardbank.co.za
Students with loans and businesses with annual turnover less than R20 million can apply for:
- 3months payment holiday
- Launch 1 April 2020
- Businesses must be in good standing
- Interest and fees still accrue for 90 days
- New instalment starts July 2020
ABSA – 0860 008 600
Corporate, wealth, business bank, private bank and retail customers in need of short-term liquidity relief may apply for the relief programme. Clients who are up to date on their payments are eligible to apply.
Individuals with loans may:
- Take a debt holiday for up to 3 months, or
- Reduce their repayments over that time
- Agreements will be adjusted, by revising the loan period and capitalising interest during the relief period
- No additional administration fees will be raised.
Corporate and business banking clients:
- Solutions based on their unique requirements and operations will be considered
- Businesses to contact their relationship managers.
Nedbank 0860 555 111
Nedbank will review the client’s current loan repayment commitments and consider the most appropriate solutions that will ease the cash flow commitments. Each case will be reviewed individually, and the most appropriate solution recommended.
These include:
- Payment arrangements: repay a reduced amount over a limited timeframe.
- Payment holidays: suspend monthly repayment based on your household’s cash flow being negatively impacted.
For clients requiring an early release on their investment funds to supplement cash flow, Nedbank will waive the penalty fee for up to the value of R200 000 at an overall portfolio level.
This offer applies:
- Between 24 March 2020 and 30 June 2020 unless otherwise communicated (capped at R200 000)
- Clients will need to confirm, in writing, that the early release request is due to income shortfall
FNB 087 575 9405
Interventions will be for all products with FNB, will be available for a period of three months and cover the following:
- Instalment cashflow relief, during which part or no instalments/repayments will be due for a specific period
- A preferential interest rate will apply to the COVID19 relief interventions given
- No fees will be charged for any relief granted
- Assistance with processing credit insurance claims, where possible
- Individualised bridge facilities for those who need it.
Interest and fees will continue to accumulate on outstanding balances. Individuals and business customers can contact FNB via their usual digital and assisted banking channels to enquire about these services.
Unemployment Insurance Fund
During South Africa’s Lockdown, workers are humbly urged to submit Unemployment, Reduced Work Time, Maternity, Illness & Adoption claims on www.ufiling.co.za/uif or email/fax to the addresses on the picture below.
Continuation forms can be obtained from www.labour.gov.za & sent to these addresses. For enquiries during lockdown, please contact our Hotline: 012 337 1997
Germiston.BCP@labour.gov.za – 0864397295
Petermari.BCP@labour.gov.za – 0864397296
EastLondon.BCP@labour.gov.za – 0864397299
Capet.BCP@labour.gov.za – 0864397300
George.BCP@labour.gov.za – 0864397301
NorthWest.BCP@labour.gov.za – 0864397302
Limpopo.BCP@labour.gov.za – 0864397303
Mpumalanga.BCP@labour.gov.za – 0864397304
Freestate.BCP@labour.gov.za – 0864397305
Online.BCP@labour.gov.za – 0864397306
Durban.BCP@labour.gov.za – 0864397297
Portelizabeth.BCP@labour.gov.za – 0864397298
NorthernCape.BCP@labour.gov.za – 0864397309
Johannesburg.BCP@labour.gov.za – 0864397294
Pretoria.BCP@labour.gov.za – 0864397290
This article is a general information sheet and should not be used or relied upon as professional advice. No liability can be accepted for any errors or omissions nor for any loss or damage arising from reliance upon any information herein. Always contact your financial adviser for specific and detailed advice. Errors and omissions excepted (E&OE)