Support related to the current COVID-19 Pandemic

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Below is a breakdown of the relief measures for South Africa that NK Accounting Services is aware of. This is a very fluid environment and new or additional relief measures are added on a regular basis. We have therefore tried to include as many relevant websites as possible. Please also watch out for other potential relief schemes communicated through the banks, government and the media.

For industry specific relief schemes, please refer to:

• For a list of essential services as well as obtaining an essential services business certificate for this, click here
• For specific relief schemes available through the DTI, click here
• Department of Small Business Development (Refer to below document explaining a request from Government for procurement of None Food Supplies). Click here to download the document.
• IDC COVID-19 essential supplies funding intervention (document attached). Click here to view their offering. Click here to download the document
• National Empowerment Fund: Funding for Black Business to fight COVID-19. For more information click here. Click here to download the document.

COVID-19 TERS (Temporary Employer-Employee Relief Scheme through UIF – Unemployment Insurance Fund)

In broad terms this is an application to UIF and the employer is encouraged to make this application (instead of the employee, to minimise number of applications). This relief scheme is to cover the salaries of employees where the employer is unable to pay the salaries. This will specifically be applicable in instances where the organisation has ben forced to close down as a result of the COVID-19 pandemic. This is not applicable where salaries are paid to employees by the employer, as this relief measure specifically deals with the payment of salaries where the employee is not being paid by the employer during the period while the employer is closed for business due to the COVID-19 pandemic. This is to assist in avoiding temporary lay-offs and to assist employees in receiving a salary or portion of their salary (depending on their income) instead of taking paid annual leave. My understanding is that this will therefore be unpaid leave and that UIF will then cover the salaries as opposed to the employer paying salaries.

The following requirements will therefore need to be met:

• The employer must be registered with UIF as an employer
• The employer must comply with the application procedure for the relief scheme
• The employer’s closure must be directly linked to the COVID-19 pandemic
• The employer will need to have a dedicated bank account for this, so that the transactions can be traced and audited.

The application procedure:

• There are certain supporting documentation that will need to accompany the application. These are:
• Letter of authority on an official company letterhead granting permission to an individual specified to lodge a claim on behalf of the employer
• Completed template with critical information from the employer, including specific affected employees.
• Evidence of last 3 months’ employee salaries (payroll information)
• Confirmation of the bank account details of the employer in the form of certified copies of latest bank statement
• All the required documentation should be emailed to covid19uifclaims@labour.gov.za
• In instances where the employer employs more than 10 employees, a Memorandum of Agreement (MOA) will also need to be completed and will need to accompany the application to UIF. Click here to download the MOA

As part of the audit and verification process, the employer will need to provide evidence of payments made to the employees of the funds received from the UIF on behalf of the employees by the employer.

There is also relief where the employee is in quarantine for 14 days or more due to the COVID-19 pandemic. Confirmation from employer and employee will be accepted as proof if the quarantine is for 14 days. If for longer than 14 days, the employee will need to supply a medical certificate from a medical practitioner. This falls under the illness benefit.

For ease of reference, please find attached:

• Department of Labour General Notice explaining the relief scheme.
• The Steps for the application process.
• A letter from Department of Labour explaining the application process.
• Employer Account Information – this is the template to complete with the employer bank details in the specific format to accompany the application. The specific format will allow easy processing by UIF and thus ensure processing of application with minimal delay.
• National Disaster Payment Excel Template – this is the template to complete with each employee’s details in the specific format to accompany the application. The specific format will allow easy processing by UIF and thus ensure processing of application with minimal delay. There are also 2 other variations of this template which may be used. Therefore, one of the templates numbered 1 to 3 will need to be completed.
• MOA (Memorandum of Agreement) – in instances where more than 10 employees are employed by the employer.

The templates can also be obtained by sending an email to covid19ters@labour.gov.za – an Autoreply email with the steps and the attachments will be emailed to you.

Department of Labour: Compensation Fund claims for occupational injuries and diseases

The benefits available:

• Payment for temporary total disablement due to COVID-19 contraction while at work, will be made for as long as such disablement continues, up to a maximum of 30 days.
• Medical aid benefits
• Death benefits.

Please refer to attached Notice on compensation for occupationally acquired COVID-19 for the documentation to accompany the claim and the process to follow.

For more information with regards to UIF and Compensation Fund relief click here

Department of Small Business Development Relief Schemes

There are 3 types of relief schemes available:

1. SMME Business Growth / Resilience Facility
2. SMME Debt Relief Scheme
3. COVID Finance Relief

The following requirements will need to be met:

• The organisation must be registered with CIPC by at least 28 February 2020
• Company must be 100% owned by South African Citizens
• At least 70% of the employees of the company must be South African Citizens
• Applicant must be able to demonstrate a direct link of impact on COVID-19.
• Priority will be given to business owned by women, youth and people with disability.
• Registration online

Applications can be made online by following this link

Disaster Management Tax Relief for Employees’ Tax, ETI and Provisional Tax through SARS (South African Revenue Services)

These are effective from the April 2020 returns up to the July 2020 returns. To qualify for these, the taxpayer (trading), should have a gross income of R50 million or less for the financial year in which the relief periods fall. The gross income should not be more than 10% made up of interest income, dividend income, remuneration from employer and rental income. The taxpayer has to be fully tax compliant.

Relief measures:

• Expansion of ETI (Employment tax incentives). ETI is applicable to persons earning a salary (remuneration) of R6 500 and lower. There is now a further R500 available per month, per qualifying employee and the employees may also be older than the normal criteria of between 18 years and 29 years.
• Employees’ Tax Deferral of 20% of an employer’s total employees’ tax liability. Please note here that this is not an exemption or discount. The amount will remain payable, this is just payable over a longer term and the 80% of the tax liability will need to be paid by the relevant due date of each period. The remaining 20% will not incur a late payment penalty, nor interest. The total deferred amount will need to be repaid to SARS from 7 September 2020 and monthly thereafter on the normal due date for employees’ tax liability over 6 equal repayments.
• Provisional Tax Deferral of 35% of a taxpayer’s provisional tax liability. Again, this is not an exemption or discount. The amount will remain payable, this is just payable over a longer term. This means that the first provisional tax payment payable during the period of the first 6 months of the current financial year will require a 15% payment of the estimated total tax liability, instead of the normal 50% payment of the estimated total tax liability. The second provisional tax payment for the financial year will require a 65% payment of the estimated total tax liability, instead of the normal 50% payment of the estimated total tax liability. The remaining amount will then be payable as part of the third top up provisional tax payment, to avoid interest and penalties. For individuals, the requirement to be able to utilise this relief with regards to provisional tax, the gross income should be below R5 million for the relevant financial year and the gross income should not be more than 10% made up of interest income, dividend income, remuneration from employer and rental income.

Refer to attached Frequently Asked Questions (FAQs) from the SARS’ website for more information on these relief measures.

There are also some relief measures applicable to Customs Duty and Vat applicable to certain imported goods (essential goods). Please note, however, normal VAT rules remain applicable to local sales and no VAT deferrals are applicable.

Refer to SARS Customs & Excise and Covid-19 News and Regulations for more information with regards to Customs.

For the latest news from SARS on COVID-19, please refer to this link

COVID-19 SME Fund (SUKUMA Relief Programme) – administered by Business Partners and funded by Rupert Foundation & Remgro

This funding is for working capital (salaries, rent, loan installments, hire purchases).

This funding is also available for Sole Proprietors and Partnerships.

This will be in the form of a R25 000 grant (not repayable) and potentially an interest free loan for the first 12 months, that will need to be repaid.

Qualifying criteria to be met:

• Provide evidence of financial viability prior to the COVID-19 outbreak
• Fully compliant entity (tax and regulatory compliance)

Application is online and very easy.

For more information and the application process click here

SA Future Trust – administered by ABSA, FNB, Nedbank or Standard Bank and funded by Oppenheimers

This funding is for financial assistance to employees of South African SMMEs who are at risk of losing their jobs or will suffer a loss of income due to COVID-19. This will be in the form of an interest free loan over a five year term.

Qualifying criteria to be met:

• Company must have annual turnover below R25 million
• Company must have traded for at least 24 months (2 years)
• Company must have been a sustainable business as at 29 February 2020
• Company must be able to prove that the business was negatively impacted by COVID-19

For more information and the application process click here

Tourism Relief Fund

The Department of Tourism encourages eligible businesses to apply for the COVID-19 Tourism Relief Fund during the application period from 07 April to 30 May 2020. Established as an intervention to mitigate the impact of COVID-19 on the tourism sector, the R200 million Tourism Relief Fund provides once-off capped grant assistance to Small Micro and Medium Sized Enterprises (SMMEs) to ensure sustainability during and post the implementation of government measures to curb the spread of Covid-19 in South Africa.

For more information click Tourism Relief Fund open. SMMEs can submit funding applications by completing a form accessible online by following this link.

Please note that all links and information were correct at time of publishing and NK Accounting Services takes no responsibilty for any and all such information which is not within our control.