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Update 7: COVID Business Support (Private Funding - Rupert)
Various private funders have provided funding to assist businesses during these testing times. In this regard the Rupert Family and Remgro has pledged R1 billion to SMEs that have been negatively affected by the COVID-19 pandemic. Business Partners has been appointed as the administrators the Fund, known as the Sukuma Relief Programme. The Programme offers distinct financial aid to formal sole proprietors, close corporations, companies and trusts.
Formal Sole Proprietors
Overview
The Sukuma Relief Programme offers qualifying formal sole proprietors a R25,000 grant. The grant is not repayable, however beneficiaries are encouraged to pay it forward and repay as much of the grant to the Public Benefit Organisation created for the initiative as they can afford. The money will be used to provide financial aid to other business owners in need, in future.
Qualifying Criteria
Evidence of financial activity prior to the COVID-19 pandemic;
Regulatory compliant; and
Tax compliant.
Documents Required
3 months’ bank statements of the business per the period 1 Dec 2019 to 29 Feb 2020;
Copy of ID document;
Copy of business licence (where applicable);
Copy of tax clearance certificate.
Application Process
The application process is only available online;
Access the application for on https://finance.businesspartners.co.za/financial-aid-for-formal-sole-proprietors/
Click on the APPLY NOW button
Complete the Application form and submit the supporting documentation
Disbursement Process
Financial aid is expected to be disbursed within 7 working days from the date of application.
Close Corporations, Companies and Trusts
Overview
The Sukuma Relief Programme offers qualifying Close Corporations, Companies and Trusts financial aid in the form of an unsecured interest-bearing loan of between R250,000 and R1 million coupled with a non-repayable grant of R25,000.
Terms and Conditions
No repayment obligations for 12 months;
No interest to be incurred or raised for 12 months;
Interest to be raised at prime rate from month 13; and
Repayment of the loan to commence from month 13.
Qualifying Criteria
Formally registered with CIPC;
Evidence of financial activity prior to the COVID-19 pandemic;
Regulatory compliant; and
Tax compliant.
Documents Required
Annual financial statements for the financial period ended 28 February 2019, signed off by a professional accountant;
Management accounts for the period 1 March 2019 to at least 31 December 2019;
The latest available EMP201 document submitted to SARS, not older than 3 months;
3 months’ bank statements of the business for the period 1 December 2019 to 29 February 2020;
A rental (premises) statement, not older than 3 months;
Statements for any other credit agreements such as asset finance or trade finance loan agreements as at 30 January 2020;
Motivation and supporting documentation clearly illustrating the financial distress suffered by the SME as a result of the COVID-19 pandemic. (i.e. reduction of turnover, erosion of working capital, inability to pay wages, rent or overheads, inability or difficulty in servicing existing debt obligations);
Statements of assets and liabilities of the main business owner;
Copies of ID’s of directors, shareholders, members, and trustees as applicable;
Copy of marriage certificate including ANC documents, divorce certificate, or death certificate where applicable;
Company/Close Corporation/Trust registration documents;
Confirmation of bank account details issued by the relevant bank.
Application Process
The application process is only available online;
Access the application for on https://finance.businesspartners.co.za/financial-aid-for-formal-small-and-medium-enterprises/
Click on the APPLY NOW button
Complete the Application form and submit the supporting documentation
Disbursement Process
Once approved, the first disbursement is expected within 7 working days from the date of application. Thereafter the approved financial aid will be disbursed over a 3-month period.
Should you require assistance or have any questions regarding the above please don’t hesitate to contact us.
Keep Calm. Keep Focused. Stay Safe!
rta Team
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Update 6: COVID Business Support (Private Funding - Oppenheimer)
Various private funders has provided funding to assist businesses during these testing times. As one of the funders, The South African Future Trust (SAFT) established by Nicky and Jonathan Oppenheimer will extend financial support (R1billion) to SMME employees who are at risk of losing their jobs or will suffer a loss of income due to COVID–19.
Application
Eligible SMME employers should apply for the scheme through their preferred partner bank. A list of names of the employees at risk together with the required supporting documentation should be submitted by the SMME on behalf of the employees.
Disbursements
The preferred partner bank will directly deposit the funds into the account of the qualifying employees.
Loan Repayment
The funding will be made available in the form of an interest free loan repayable by the SMME within 5 years.
Partner Banks
The scheme is currently available to the clients of four banks, namely ABSA, Standard Bank, Nedbank and FNB.
Eligibility Criteria
The SMMEs need to meet the following criteria to qualify for the scheme:
Annual turnover should be less than R25mil
Trading for at least 24 months
Sustainable business on 29 February 2020
Adversely impacted by COVID-19
Required Documentation
The SMMEs will need to provide the following documentation (as a minimum) to apply for the scheme:
The Company registration number
A valid PAYE registration number registered with SARS
A valid Income Tax number registered with SARS
Confirmation of permanent employment status of the employee
It is expected that the SMMEs should be able to apply for the funding from 3 April 2020, by registering the interest directly with their bank.
Additional information can be found at https://opp-gen.com/saft/#1585326755466-d7616160-6829
Should you require assistance or have any questions regarding the above please don’t hesitate to contact us.
We will continue to provide information as soon as it becomes available. Please be on the look at for our emails under the following heading: UPDATE: COVID-19 BUSINESS SUPPORT
Keep Calm. Keep Focused. Stay Safe!
rta Team
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Update 5: COVID Business Support (UIF)
During the last couple days there has been a significant volume of content relating to Covid-19 Support to SME’s. However, when one is anxious and stressed it can be very overwhelming, intimidating and it may be difficult to see the wood from the trees. We have therefore thought it appropriate to provide some clarity on what we see as the most pressing matter – the treatment of our employees and UIF benefits.
Unemployment Insurance
To combat the impact of the COVID pandemic contributors, the UIF will assist effected workers through existing benefits. These benefits include:
Reduced work time benefit
This benefit is applicable when a Company shuts down for a period of time or the work time is reduced. The benefit payable this the difference between the amount paid by the employer and the normal UIF benefits should to employee lose their employment.
Illness benefit
The benefit is applicable in the event that an employee becomes ill and has to be quarantined for 14 days. The benefit payable is calculated in terms on the existing UIF regulations.
Death benefit
The benefit is applicable should and employee pass away as a result of contracting the COVID-19 virus. The benefit payable is calculated in terms on the existing UIF regulations.
In addition to the above a National Disaster Benefit was established. If an employer decides, as a direct result of the COVID-19 pandemic, to close its business for a period and send their employees home, these employees are deemed to be temporarily laid-off. In the event that the employer cannot pay the employees during this time, the Employer may apply for the National Disaster Benefit from the UIF. The value of the benefit amounts to a minimum wage of R3,500 per employee.
Below please find a link to a youtube video from the Tax Faculty explaining the COVID-19 UIF specific benefits which we have found to be very informative and helpful.
https://www.youtube.com/watch?v=TE-wCl9H1sw
COVID -19 Temporary Employee Relief Scheme (TERS)
The existing TERS was expanded by the Minister of Labour on 25 March 2020 to include a COVID-19 TERS. In terms of COVID-19 TERS should an Employer as a direct result of the COVID-19 pandemic close its operations for a 3 months or lesser period and suffer financial distress, the Company may be eligible for a Covid-19 Temporary Relief Benefit.
The key documents to submit or complete are the following:
Letter of authority, on an official company letterhead granting permission to an individual specified to lodge a claim on behalf of the company
MOA (completion of the agreement between UIF, Bargaining Council and Employer)
Prescribed template that will require critical information from the employer
Confirmation of bank account details in the form of certified latest bank statement
Evidence / payroll as proof of the last three months employee(s) salary(ies)
The document should be sent to [email protected] for assessment and evaluation.
It should be noted that it is unclear how the applications for benefits in terms of the COVID-19 TERS will be evaluated. We expect further clarity in the coming days.
Please find the following:
A Q&A listing received from our of our suppliers that we found useful (please feel free to contact Suzaan at [email protected] if you require specific HR related support and advice)
Should you require assistance or have any questions regarding the above please don’t hesitate to contact us.
Keep Calm. Keep Focused. Stay Safe!
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Update 4: COVID Business Support (Tax Relief)
On 29 March 2020 the Minister of Finance issued a media statement confirming the tax relief measure outlined by the President on 23 March 2020. Explanatory notes providing additional information where issued together with the media statement. The salient points are as follows:
A tax subsidy to employers of up to R500 per month for the next four months for those private sector employees earning below R6,500 under the Employment Tax Incentive, were introduced.
The South African Revenue Service will accelerate the payment of employment tax incentive reimbursements from twice a year to monthly to get cash into the hands of compliant employers as soon as possible;
Tax compliant businesses with a turnover of R50 million or less will be allowed to delay 20% of their employees’ tax liabilities over the next four months and a portion of their provisional corporate income tax payments without penalties or interest.
It should be noted that the proposed amendments are deemed to have came into operation on 1 April 2020 and will therefore be applicable to tax periods ending after that date. The deferment of 20% of the employees’ tax liabilities is therefore applicable from the April 2020 period, payable 7 May 2020 and not from the March 2020 period which is payable on 7 April 2020.
Should you require assistance or have any questions regarding the above please don’t hesitate to contact us.
We will continue to provide information as soon as it becomes available. Please be on the look at for our emails under the following heading: UPDATE: COVID-19 BUSINESS SUPPORT
Keep Calm. Keep Focused. Stay Safe!
rta Team
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Update 3: COVID Business Support (TERS)
On 26 March 2020 the Minister of Employment and Labour gazetted the Covid-19 temporary employee/employer relief scheme.
The salient point of the scheme is:
Should an employer as a direct result of Covid -19 pandemic close its operations for a 3 (three) months or lesser period and suffer financial distress, the company shall qualify for a Covid-19 Temporary Relief Benefit.
The benefit shall be de-linked from the UIF's normal benefits and therefore the normal rule that for every 4 (four) days worked, the employee accumulates a one day credit and the maximum credit days payable is 365 for every 4 (four) years will not apply.
The benefits will only pay for the cost of salary for the employees during the temporary closure of the business operations.
The salary benefits will be capped to a maximum amount of R17,712 per month, per employee and an employee will be paid in terms of the income replacement rate sliding scale (38 % -60 %) as provided in the UI Act.
Should an employee's income determined in terms of the income replacement sliding scale fall below the minimum wage of the sector concerned, the employee will be paid a replacement income equal to minimum wage of the sector concerned.
Qualifying employees will receive a benefit calculated in terms of sections 12 and 13 of the UI Act, provided that an employee shall receive a benefit of no less than sector specific minimum wage.
For the company to qualify for the temporary financial relief scheme, it must satisfy the following:
The company must be registered with the UIF;
The company must comply with the application procedure for the financial relief scheme; and
The company's closure must be directly linked to the Covid-19 pandemic.
Employers wishing to apply should send a mail to [email protected]. An automatic response outlining the application process should be received.
We sent a test mail to [email protected], but did not receive an automatic reply. It therefore seems that the system is not fully operational yet. We will advise as soon as a response is received.
Please find the Government Gazette Directive and below the URL an article from Business Insider providing more information:
https://www.businessinsider.co.za/government-pays-workers-during-lockdown-2020-3
Should you require assistance or have any questions regarding the above please don’t hesitate to contact us.
We will continue to provide information as soon as it becomes available. Please be on the look at for our emails under the following heading: UPDATE: COVID-19 BUSINESS SUPPORT
Keep Calm. Keep Focused. Stay Safe!
rta Team
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Update 2: COVID Business Support (Overview)
During the lockdown period only businesses that provide essential services will be allowed to trade. Businesses that provide such services are required to apply for a certificate to trade.
If you qualify as an essential services and wish to apply for a certificate to trade during the lockdown period you can do so through bizportal.gov.za – Please find the url below:
https://bizportal.gov.za/essential_service.aspx
Please note that the submission of incorrect information is a criminal offence and will lead to prosecution.
Keep Calm. Keep Focussed. Stay Safe!
rta Team
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Update 1: COVID Business Support (President's Address)
Tools & Resources
During the President’s address on 23 March 2020 various COVID-19 Economic Support & Relief Measures were introduced. The highlights are as follows:
Economic Support
The president said the state was working on a special dispensation for companies in distress because of the coronavirus. Under this proposal employees could receive wages via a temporary employee relief scheme to let companies pay employees directly. He did not provide further information.
The state will consider utilising the reserves of the Unemployment Insurance Fund to extend support to workers in small and medium-sized enterprises and vulnerable firms faced with loss of income. Details will be made available in coming days.
The state will provide a tax subsidy of up to R500 a month for four months for private sector workers earning less than R6 500 a month. He said this would help up to 4 million workers.
The president said tax-compliant businesses with a turnover of less than R50 million would be allowed to delay 20% of their PAYE liabilities over the next 4 months, and a portion of their provisional corporate income tax payments over 6 months. This is expected to assist over 75 000 enterprises.
The state is exploring the temporary reduction of contributions to the UIF and the Skills Development Fund.
Commercial banks have been exempted from provisions of the Competition Act to enable them to develop common approaches to debt relief and other necessary measures, said Ramaphosa.
The Industrial Development Corporation has put a package of R3 billion together for industrial funding for vulnerable firms and will seek to fast track financing for companies critical to efforts to fight the virus.
The Department of Tourism has made R200 million available to assist small and medium-sized enterprises.
The Department of Small Business Development has made R500 million available immediately to assist small and medium-sized enterprises.
What We Don’t Know
The detail of the above economic relief measures has not yet been communicated. Further clarification relating to support will be provided in due course.
We will share this information as soon as it become available and continue to provide guidance and support relating to these matters.
What We Do Know
UIF
The Department of Labour advised that effected employees will be able to claim UIF. Please find further information and a process guide (Easy Aid for Corona Benefits) issued by the Department of Labour. Please read carefully.
Please also find attached the official forms to be completed in support of the application.
UI2.1 (UI application form)
UI19 & UI2.7 (to be completed by the Employer)
UI2.8 (bank details form to be completed by the Bank)
Self quarantine employee letter
Self quarantine employer letter
SMME Support
The Department of Small Business Development released a statement pledging assistance to eligible SMME’s effected by the COVID-19 State of Disaster. Please find the statement issued. SMME’s requiring assistance are required to register on www.smmesa.gov.za.
Should you require assistance or have any questions regarding the above please don’t hesitate to contact us.
Keep Calm. Keep Focused. Stay Safe!
Kind Regards
rta Team
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