The rapid outbreak of the Coronavirus challenges everybody and forces one to face various dilemmas. The controlled slow-down of further infections is the top priority. Many customers of Beaufort are active in vital sectors and/or perform crucial tasks for our society. That’s why (contributing to) the slow-down of a further spread is our top priority as well. Especially in times of distress, Beaufort wants to support its clients by providing continuity and quality of its service (towards its clients) at the highest level. By taking the right steps on short notice, companies can stay in control of the situation and take the right actions. We recommend companies to perform a Quick Scan of the organisation. See this presentation for an elaboration of our approach.
Various regulations are implemented to tackle the (economical) impact of the Corona virus by governments and banks. On this page we would like to keep you informed of the most actual regulations for companies in the Netherlands:
1. Temporary emergency bridging measure for wages (NOW-regulation
The NOW-regulation has been extended by 9 months (3x three months) as of 1 October 2020 until 30 June 2021 (NOW 3 and 4). Under the current NOW 3 regulation, an entrepreneur who expects a loss of revenue (minimum 20%) can ask the UWV for a compensation of the salary expenses (currently max. 80% depending on the amount of lost revenue) for a period of three months. The minimum loss criterion will very likely be increased from 20% to 30% under the new NOW 3 regulation as of April 2021. Under NOW 3, the compensation of salary expenses is 80%. This compensation percentage will be reduced very likely from April 2021.
In this way, companies can keep on paying their employees. The extended NOW scheme is comparable, but contains some changes in comparison with the first and second schemes. See additional information.
2. Temporary bridging regulation for self-employed entrepreneurs (Tozo-regulation)
The TOZO regulation for supporting self-employed entrepreneurs has been extended by 9 months (3x three months) from October 2020 to the end of June 2021. Extension takes place by TOZO 3 (until 31 March 2021) and TOZO 4 (until 30 June 2021). The regulation will be executed by the municipality. Self-employed entrepreneurs can receive additional income support (for a period of three months) via an accelerated procedure. This will supplement the income towards the social minimum and in principle does not have to be repaid. The conditions for applying for TOZO 3 and 4 have been changed. For instance, a capital test (no more than € 46,520 in available cash and cash equivalents) will now be part of the TOZO 4 procedure (as of April 2021).
Support from this temporary measure is also available by means of a loan for equity with a reduced interest rate.
The TVL regulation helps SME entrepreneurs who have been affected by the Corona crisis and having problems paying their fixed costs (excl. salary expenses). The TVL is intended for entrepreneurs in specific branches and is implemented by the RVO.
The current TVL scheme has been extended for 9 months (3x three months) until the end of June 2021. Under the current scheme SME entrepreneurs receive a reimbursement with a maximum of € 90,000 (per 3 months). The TVL reimburses a maximum of 50%-70% of the fixed costs, which will be calculated by using the formula: subsidy = normal turnover x turnover loss in % x share of fixed costs in % x 50%-70%. Currently a turnover loss of at least 30% applies. The minimum turnover loss criterion will be gradually increased in 2021.
In Q4 2020 some special additions will apply for the TVL:
- From 1 October until 31 March 2021, there will be no SBI code restrictions in place for receiving TVL. This means that all SMEs (with exception of financial institutions) that meet the other requirements can apply.
- Entrepreneurs in the hospitality sector which have been forced to close down from 14 October 2020 will receive a one-off supplement with the TVL for Q4 2020. This amounts to 2.75% of their turnover loss. This addition will be worked out in more detail.
- Entrepreneurs in the events sector and their suppliers who have received the TVL for the summer months but cannot reach the turnover threshold for Q4 2020, will receive a reimbursement for this period. The amount will be based on the reimbursement for the summer months. This addition will be worked out in more detail.
4. Temporary Investment Discount (BIK)
The government has introduced a new temporary investment discount to allow companies to invest in assets during the Corona crisis. The scheme is called “Baangerelateerde Investeringskorting” (BIK) and mainly intended for SMEs. The offered discount varies between the 2.44% and 3.0% of the investment. An amount of € 4.0 bn is made available for this scheme.
The BIK scheme only applies to new investments in assets made at or after 1 October 2020. The investments have to be fully paid between 1 January 2021 and 31 December 2022. Next to it, the assets have to be put in operation within 6 months of full payment.
RVO and the tax authorities will be responsible for this new scheme. As the BIK should be approved first by parliament, it is currently not applicable.
5. Social support scheme for education and job support
The Corona crisis has serious impact on employment. The government has introduced a social package (support scheme) of € 1.4bn to maintain and create employment. This scheme provides for, inter alia education and support from job to job.
6. Temporary Support for Necessary Costs (TONK)
Self-employed persons or employees who are not entitled to other support schemes will receive extra support. This scheme, the Temporary Support for Necessary Costs (Tijdelijke Ondersteuning Noodzakelijke Kosten (TONK)), runs through municipalities and has yet to be worked out.
Credits and guarantees
1. Extension of regulations considering the guarantee on entrepreneurial financing (GO-C regulation)
Companies that face trouble when attracting bank financing and guarantees can make use of the GO-regulation (‘Garantie Ondernemersfinanciering’). The ministry has increased the limit from €400 million to €10 billion. With the standard GO-regulation, the ministry supports both large and medium-sized companies by means of a 50% guarantee on bank loans and guaranties (minimum €1.5 million and max €150 million per company). Since April 7th 2020 the guarantee has increased to 80% for large companies and 90% for medium-sized companies under the condition that companies facing problems due to the Corona crisis (GO-C regulation). The GO-C regulation will be extended until 30 June 2021.
2. Extension of the guarantees on mid and small cap credits (BMKB-regulation)
The ministry of economic affairs and climate guarantees credits to entrepreneurs by means of the BMKB-regulation, so they are enabled to attract funding more easily. For this, entrepreneurs can contact credit issuers, such as banks. In the normal regulation (BMKB-B) the guaranty is limited to 50% of the credit (max €1.5 million). The BMKB scheme has been expanded because of the Corona crisis (BMKB-C). The guaranty in this new BMKB-C scheme is limited to 75% of the credit. The guarantee of the government is maximised at 90% of the guaranteed credit (both BMKB-B and BMKB-C). In this way, banks can provide credit easier and faster, and companies have the opportunity to borrow more money faster. Furthermore, the regulation has been further enhanced than previously announced at Thursday the 12th of March 2020, and will also apply to bridge and current accounts with a duration of max. two years. Since April 2020 the BMKB premium has been lowered from 3.9% to 2%.
3. Temporary guarantee for agricultural companies (BL-C regulation)
For agricultural companies, a temporary guarantee for working capital will be provided within the BL-regulation (‘Borgstelling MKB-Landbouwkredieten’). Hereby, the ministry guarantees the credits of agricultural entrepreneurs. The adjusted BL-regulation is in effect per the 18th of March 2020.
4. Small Corona Credit Guarantee Scheme (KKC):
In addition to other Corona Credit regulations a new scheme has been introduced for small financially strong companies. SME’s with relatively small financial needs may be eligible for a bridging loan of up to €50,000 under the Small Corona Credit Guarantee Scheme (Klein Krediet Corona garantieregeling or KKC). The KKC loans will be offered by ABN AMRO, ING, Rabobank, Triodos, Volksbank and some accredited BMKB credit providers with a maximum loan term of 5 years and a maximum interest rate of 4.0%. The KKC regulation will be extended until 30 June 2021.
5. Corona bridge loan for Start-ups, Scale-ups and innovative companies (COL)
Startups and scale-ups will be able to apply for credits between €50.000 and € 2 million from Regional Development Companies (ROMs) For more details about terms and conditions and how to apply, see COL.
6. Interest discount small entrepreneurs on micro credits (Qredits)
Micro credit supplier Qredits finances and coaches a large group of small entrepreneurs and start-ups, that have a hard time attracting financing from banks. One could think of entrepreneurs in the hospitality industry, retail, personal healthcare, construction, and business services. Qredits will implement a temporary crisis regulation: Small entrepreneurs who are affected by Corona related problems are offered postponement of repayments for the duration of six months. The interest is automatically lowered to 2% during this period. The ministry supports Qredits with this regulation with a maximum of €6m.
7. Corona bridging credit (Qredits)
Micro credit supplier Qredits can provide extra funding during the Corona crisis. Existing entrepreneurs can apply for a Corona bridging credit with a maximum of €25,000. Interest is 2.0% for the first year and subsequently 5.57%.
8. State guarantee for credit insurance
The Dutch State will provide a guarantee of €12bln. to secure the credit insurance of companies which supply goods to small medium enterprises (SME). By using this State guarantee the government wants to prevent that credit insurers decrease or withdraw their insurance limits. The guarantee ensures risk sharing between the insurers (10%) and the State (90%), up to a volume of €1,0 bln and provides an additional safety net by the State to cover up €12 bln in total.
9. Extension insurance export credits
The new regulations for the extension of export credits imply that short-term export credit insurances are covered as well (in the past only >2 years, currently also <2 years). In addition, an extension of the possibilities for domestic coverage will be provided, as well as a relaxation of the international policies with coverage for additional countries. Furthermore, procedures are extended and accelerated, and a higher percentage of working capital will be covered. This package of regulations will enable companies to cover more risks as a result of state guarantees. This will ensure the continuation of international trade and can prevent loss of export and jobs. Currently, people are working on a further acceleration of the lead times of export credit insurances.
1. Relaxation of postponement of tax payments and reduction of fines by the Dutch tax authority
The period for which affected entrepreneurs can request for postponement of tax payments will be extended until 1st of April 2021. The tax authority will then stop with collections immediately. This applies to all income, corporate, VAT, and salary taxes. Fines for overdue payments will be wavered. It is not necessary to provide any evidence when applying for this regulation. However, this will be required in a later stage. Entrepreneurs who have had tax postponement must start repaying the deferred tax no later than 1 July 2021 (in 36 instalments).
The interest on overdue payments has been temporarily reduced from 4% towards (almost) 0%. This reduction applies to all taxes.
2. Additional tax regulations
The government has announced six new tax regulations to support entrepreneurs during the Corona crisis. These regulations will provide more financial support next to the regulations which already have been taken.
The additional tax regulations include:
- Reduction of the “appropriate wages” criterion in case of a substantial equity share (aanmerkelijk belang).
- Simplifying the hour criterion for self-employed entrepreneurs without personnel (ZZP-ers);
- one-off increase of work-related costs (werkkosten regeling);
- Tax settlement loss 2020 with profit 2019;
- Postponement of new bill “Excessief lenen bij eigen vennootschap”;
- Break for mortgage repayment obligations.
3. Tourism taxation
The ministry is negotiating with the municipality (‘Vereniging Nederlandse Gemeenten’ (VNG)) whether local taxation of entrepreneurs can be cancelled and the already issued assessments can be withdrawn. This is especially the case for tourism taxation.
Sector specific regulations
1. Agreements about financial security of healthcare providers (ministry of community healthcare and youth & security)
Due to the Corona crisis, many healthcare institutions experience financial insecurity, because they now have to provide much more or much less healthcare than was expected. The ministry and the municipalities have therefore made agreements about safeguarding the financial security of healthcare providers within the laws ‘Communal support’ and the ‘Youth-law’. This covers temporary measures (at least until the 1st of June 2020) for a.o. the financing of additional costs, compensation for missed revenue, maintaining of liquidity, and the relaxation of accountability. In this phase of the crisis, healthcare providers require this to ensure continuity and safeguard support and availability of professionals there where they are required the most.
2. SET Covid19 2.0: Stimulation digital healthcare (SET-regulation)
To enable digital healthcare, the SET-regulation is temporarily extended. Healthcare providers or supporters that want to put additional effort in digital healthcare for patients at home during the Corona crisis, can qualify for the extension of the SET-regulation. This extension provides a grant for digital applications for clients or their caretakers. The grant is an amount between € 25,000 and €50,000 of which max. 40% can be used for the acquisition, lease, or licensing costs of digital applications. Furthermore, the grant can be used to hire external consultants for implementation services. No own contribution is required.
3. Support Local media
Local media whose advertising income decrease can apply for support from the government under the new Temporary Support for Local Media scheme.
4. Additional support cultural sector
The government announced an additional amount of €482 million for supporting institutions which are essential for the cultural sector. Main objective is securing employment and investments for the new cultural season. The additional support will be provided by subsidies and loans.
5. Voucher Credit Facility
Because many vacations and trips have been cancelled in 2020, travel organisations provided vouchers to their clients. Most organisations are unable to pay out these vouchers. Therefore a credit facility or voucher bank for travel guarantee funds is being set up by ANVR sector organization, the SGR guarantee fund and the government. Through this voucher bank, the travel guarantee funds can obtain an additional loan from the government. The guarantee fund can thus provide temporary credit to a travel organisation that have issued vouchers for package tours. The scheme is currently being further elaborated and has yet to be approved by the European Commission.
Financial sector regulations:
1. Temporary postponement of repayments for mid and small cap customers
At the beginning of the Corona crisis banks (e.g. ABN AMRO, ING, Rabobank, Volksbank, and Triodos Bank) decided to stretch the repayments of financial sound SMEs. The postponement was generic until October 2020. In specific cases, banks still allow postponement of repayments after 1 October 2020. In contrast to earlier this year, this is mainly based on customized solutions. Companies facing payment difficulties are recommended to contact their banks.
2. Continuity contribution by health insurance companies
Health insurance companies will provide a continuity contribution to healthcare providers whose turnovers have decreased significantly due to the Corona crisis. By paying these contributions health insurance companies want to safeguard medical care after the Corona crisis.
The continuity contribution will be based on their normal turnovers (based on the period March until June 2020). The percentage will vary between 60% and 85% and will be dependent by healthcare provider. The contribution will be paid in May 2020.
3. Support hospitals UMC’ and mental healthcare by health insurance companies
In the first half of 2020 health insurance companies, hospitals and University Medical Centres (UMC’) agreed on an advance payment arrangement (100% of their expected turnover) to avoid financial difficulties caused by the Corona crisis. The main reason for that is to safeguard medical care after the Corona crisis. In addition to this, health insurance companies, hospitals and University Medical Centres (UMC’) agreed in July 2020 on a definitive arrangement for lost income and additional costs. This will be funded by the collective insurance premiums and, if needed, the reserves of the healthcare insurance companies. Next to this, health insurance companies and the Dutch mental healthcare (GGZ) announced that an Corona agreement will be prepared for the short term for larger mental healthcare providers. The main reason for that is to safeguard mental care after the Corona crisis.
4. Payment scheme Pension funds
The Dutch pension funds have announced that companies can apply for payment schemes, within the legal framework.
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