COVID-19 Relief Measures

by Mark Moir - Certfied Financial Planner - Beanstalk Online Investments
South African Covid-19 Relief Measures

COVID-19 Temporary Employee / Employer Relief Scheme (TERS)

This allows employers to apply for the temporary finiancial relief to stem the financial distress caused by the pandemic, for up to 3 months.

Benefits will pay a replacement income equal to the minimum wage of the sector concerned and be capped to a maximum amount of R17,712.00 per month, per employee. Businesses can apply for the COVID-19 TERS benefit from the UIF by sending an email to covid19ters@labour.gov.za where you will be prompted with further instructions.

Business Growth and Resilience Facility for essential services

The Industrial Development Corporation (IDC) together with the Department of Trade, Industry and Competition has set aside R3 billion to aid medical and hygiene product suppliers with capital to ensure they are able to meet the high demand during this COVID-19 pandemic. Essential services businesses will need to obtain approval from the department for approval to trade here: www.bizportal.gov.za.

SMME Relief Finance Scheme

Soft-loan funding for existing businesses in distress due to the COVID-19 pandemic is available under this scheme. The relief will be for a period of 6 months from 01 April 2020. For the application process visit www.smmesa.gov.za

Spaza shop support scheme

This scheme will provide seed capital to shop owners to allow them to continue to provide essential goods. They must have a permit to trade from a local municipality as one of the core requirements.

South African Future Trust (SAFT)

The SAFT allows SMMEs to apply for an interest free loan - helping them keep their employees during this time of cash flow crunch. Terms can be reached to repay the loan, once the crisis is over. This fund was created by the Oppenheimers.

Eligibility includes annual turnover of below R25m, trading for at least 2 years, sound business as on 29 February and demonstrated adverse impact due to COVID-19. Details of the fund are available at https://opp-gen.com/saft/.

Tourism relief fund due to COVID-19 travel restrictions

The Department of Tourism has made an additional R200 million available to assist the industry as it is impacted by the new travel restrictions. It will be administered to benefit SMMEs in all the 9 provinces and various tourism sub-sectors.

Payment Holidays

Some banks are offering payment holidays as detailed below.

Standard Bank

Standard Bank will support small and medium-sized enterprises (SMEs) with a payment holiday for 90 days (01 April 2020 until 30 June 2020) - restructuring payments for the repayment to come into effect after the 90-period. Visit the Standard Bank COVID-19 site for more information.

Small businesses, students and those needing help with home loans can email debtcarecentre@standardbank.co.za or call 0860 123 000.

ABSA

ABSA's corporate and business clients will be offered solutions based on their unique requirements and operations. For retail clients, the ABSA relief programme incorporates a three-month payment holiday and allows customers to reduce their monthly repayments. See more details on the ABSA COVID-19 site.

ABSA bond home-owners who would like to apply for relief should email bondrs@absa.co.za.

FNB

From 1 April to 30 June 2020 FNB is providing relief to individual and business FNB customers whose financial stability has been impacted by COVID-19 pandemic. Visit the FNB press office for more information.

Nedbank

No specific relief policy for businesses or customer are currently in place. Customers are encouraged to contact the bank directly if they are in financial distress due to COVID-19. Call 086 055 5111.

Customers who need payment relief should call the dedicated debt relief centre on 0860 110 702 and home-owners who need help can also email HLCollections@Nedbank.co.za or MoratoriumRequest@Nedbank.co.za

Small Enterprise Finance Agency (Sefa) Debt Restructuring Facility

The Agency is offering six-month payment holidays

Small businesses funded by the Sefa will be given a payment holiday for the next six months, with certain conditions applicable. For the application process visit www.smmesa.gov.za

Companies are allowed to keep 20% of monthly PAYE

Small- to medium-sized businesses - with an annual turnover of less than R50 million - will be able to defer payment of 20% of their employees' tax (PAYE) liabilities due and payable for the period 1 April 2020 to 31 July 2020, without penalties and interest. The relief will be available to tax-compliant businesses.

The 20% deferral will be payable in equal instalments over six months from 1 August 2020, i.e. the first instalment must be paid by 7 September 2020.

Customs duty and VAT concessions on importation of "essential goods"

SARS issued a media statement on 27 March 2020 (updated on 29 March 2020) on certain customs duty and VAT concessions on the importation of "essential goods" as defined in the regulations issued under the Disaster Management Act.

Importers will be able to claim a full rebate of customs duty and VAT exemption on the importation of certain goods. A list of the qualifying goods is available on the International Trade Administration Commission (ITAC website). The importer will need to obtain an import permit from ITAC to be able to claim this benefit.

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