Following up on the Covid-19 July Stimulus announced by Government on 23rd July 2020, David Leydon, Head of Food & AgriBusiness with ifac, shares what business owners and CEOs should focus on from the 50 measures that were included in the Government announcement.
Employment support
A new Employment Wage Support Scheme will succeed the Temporary Wage Subsidy Scheme:
This will run until April 2021 at a flat rate of €203 per week (down from €410 per employee per week) with new or seasonal employees eligible.
Business must be suffering a 30% decline in turnover.
The Apprenticeship Incentivisation Scheme will provide €2,000 payment to support employers to take on new apprenticeships in 2020.
Jobs Plus Scheme – a grant of €7,500 available over 2 years, if you employ person under 30 years who is currently on the Live Register or in receipt of Pandemic Unemployment Payment.
Other measures worth noting include:
Pandemic Unemployment Payment extended to 1 April 2021 with a reduced payment.
Covid-19 Illness Payment continues at an enhanced rate of €350/week.
Grant aid
The Restart Grant for Enterprises is being extended to wider number of SMEs and the payment level is now being increased to €25,000. Firms that accessed the Restart Grant will be eligible to apply for a second top-up payment. The criteria for accessing the scheme will include Enterprises that have:
250 employees or less;
Turnover of less than €100,000 per employee; and
Reduced turnover by 25% as a result of COVID-19.
Apply through your Local Authority.
The Trading Online Voucher Scheme (TOV) from your Local Enterprise Office will receive further funding so anyone who hasn’t engaged with the TOV should do so. This is worth €2,500 and is 90% funded.
The expansion of the Enterprise Ireland €180 million Sustaining Enterprise Fund scheme to include direct grant support to viable businesses, in addition to equity and repayable advances. Up to €800,000 of support to sustain businesses who can return to viability. Contact your EI DA.
A €20m Brexit fund to help SMEs involved in exporting and importing with the UK and further afield to put in place the staff, software and IT systems to be ready for new customs arrangements from 1 January 2021. Unfortunately Brexit is coming rapidly into focus and all SMEs with exposure need to re-engage with Brexit planning immediately. More to come on this.
Finally, don’t ignore the Enterprise Ireland Covid-19 Business Financial Planning Grant – more info here on eligibility (importantly you don’t need to be an EI client to avail of this support): https://globalambition.ie/supports/innovation-support/covid-19-business-planning-grant/
Finance
The €2 billion COVID-19 Credit Guarantee Scheme will see Government provide an 80% guarantee for a wide range of credit products from €10,000 to €1 million up to a maximum term of 6 years. Contact AIB, BOI or Ulster Bank.
A package of liquidity and enterprise investment measures worth €55 million will be put in place to support small and micro companies through additional resources for MicroFinance Ireland and the Local Enterprise Offices including measures to reduce interest rates on lending for micro and small businesses, including grants equivalent to 0% interest on the first year of SBCI and MFI loans.
The Future Growth Loan Scheme is being expanded from €200 million to €500 million with the European Investment Bank Group, so businesses with up to 499 employees can invest for the longer-term at competitive rates: https://dbei.gov.ie/en/What-We-Do/Supports-for-SMEs/Access-to-Finance/Future-Growth-Loan-Scheme/.
Tax/Revenue Measures
Temporary reduction in the standard rate of VAT from 23 to 21% beginning in September.
Early carry-back of trading losses will be allowed, leading to an immediate refund of some or all of corporation tax paid to provide immediate cash-flow support to previously profitable companies.
New income tax relief for the self-employed for losses in 2020 where profit was earned in 2019.
The Government will also pass legislation to confirm the previously announced warehousing of tax liabilities. This will allow for businesses affected by Covid-19 to delay payment of their PAYE and VAT debts in part of in full for a set period with no interest or penalties.
For those paying commercial rates most of you will granted a waiver for the six months to end-September 2020.
Future Jobs
€10m will be provided to help businesses engaging in green research, development and innovation, capital investment, and capacity building through the first phase of the Green Enterprise Fund.
An increase of €10million in funding for the Seed and Venture Capital sector through Enterprise Ireland as a top-up to existing funds and leveraging a combined additional pool of investment of €55 million, as part of the Government’s commitment to innovation driven enterprises – this will apply to many SMEs we work with.
Farm focused supports
Additional TAMS funding for on-farm renewable energy investment
€50m to support beef finishers affected by Covid-19 (detail not announced)
And finally, you might want a break in October… make sure to avail of the Stay and Spend Incentive which will see all taxpayers spending over €625, on accommodation, food and non-alcoholic drinks, between October 2020 and April 2021, able to claim back €125 through a tax credit.
If you have any questions or need any further clarity, you can contact David Leydon, Head of Food & AgriBusiness at davidleydon@ifac.ie or telephone directly on 0879908227.