The fact that the outbreak of the coronavirus will lead to serious economic consequences around the world is obvious to everyone, and no one doubts this fact. The exact impact on the economy of the Netherlands directly will depend on the speed at which the coronavirus spreads, which is currently impossible to accurately predict. Losses are incurred not only by large, but also by small companies, and individual entrepreneurs have also experienced problems.
To mitigate the economic impact, the Cabinet of Ministers has proposed a series of measures designed to provide support to businesses in addition to automatic fiscal stabilizers. Some measures are already in place and some are still under development.
We have prepared for you an overview of the proposed measures and described the mechanisms of their work:
- Reduction of working hours. (the measure is already in force)
Reduced working hours are an existing scheme that companies can apply if, due to an emergency (for example, a virus epidemic), they are temporarily unable to provide work for some of their staff. Those workers who are temporarily unemployed as a result of this emergency situation can claim unemployment benefits (werkloosheidsuitkering - WW).
Companies can request this type of assistance if:
- As a result of the epidemic, employees were unemployed for at least 2 and no more than 24 weeks
- At least 20% of staff lost their jobs
The applicant (company) bears responsibility for the correctness of the data provided and compliance with all conditions. According to the Ministry of Social Affairs and Employment (Sociale Zaken en Werkgelegenheid – SZW), the number of applications for this service has already exceeded 1700.
Self-employed persons cannot count on this type of assistance as they do not hire staff. But if they are experiencing difficulties due to the outbreak of the coronavirus, then on the basis of the so-called Decree on Assistance to Self-Employed Persons (Besluit bijstandverlening zelfstandigen), they can turn to the municipality where they are registered for help.
- Temporary change in the terms of lending to small and medium-sized businesses (planned)
If this measure is approved, banks and other lending institutions will temporarily provide bridging loans or an increase in the current account (overdraft). The possibility of suspending the repayment of existing loans without penalties is also being considered.
In addition, by the end of March, a new temporary measure will be introduced (it will be valid until April 1, 2021) aimed at simplifying the conditions for obtaining a loan for small and medium-sized businesses, this will be possible by increasing the share of the state guarantee in the insurance of these loans. This will help small and medium-sized companies that want to take out a loan but are unable to offer sufficient guarantees to the bank.
- Deferral of taxation (the measure is only planned)
Entrepreneurs will be able to request a special grace period for income tax, corporate tax, value added tax and payroll tax. The tax office will provide a deferred payment if the entrepreneur informs it in writing that he is having problems due to the crisis caused by the coronavirus. Such applications will be honored immediately upon receipt. The check will take place later. It is also planned to abolish the late tax penalty by default.
4. Changing the preliminary tax estimate
In addition, entrepreneurs who expect lower profits due to the epidemic can apply for a reduction in income tax advance payments (voorlopige aanslag). This is a tax that we pay in advance, but its calculation is based on the results of previous years. These requests will also be immediately satisfied by the tax authorities in order to immediately reduce the tax burden.
If your business is suffering losses due to the coronavirus epidemic, don't wait, get help. We hope that the measures proposed by the government will support your business in difficult times. If you need additional advice on this issue or assistance in completing the above requests, please contact Nalog.nl, we will certainly help you.
Publication Date: 14.03.2020
