TEMPORARY EMPLOYER/EMPLOYEE RELIEF SCHEME (TERS) FINALISED

Minimising loss of income and economic impact for employees and employers during COVID-19

Business for SA, welcomes the agreement finalised between government, business and labour at Nedlac on the Temporary Employer/Employee Relief Scheme (TERS). The notices based on the agreement have been signed by Employment and Labour Minister Thulas Nxesi and await imminent gazetting 

The TERS will be funded through accumulated reserves of the Unemployment Insurance Fund (UIF) administered by the Department of Employment and Labour (DEL), and operates in terms of a revised directive issued by the Minister of Employment and Labour on 4 April. In addition, the benefits are subject to the terms of the memorandum of understanding or standard terms, which have also been published.

Benefits are available to all employees who are, along with their employers, contributors to the UIF where the employer has closed its operations, or part of its operations, as a direct result of the Covid-19 pandemic, and where an employee has suffered, or will suffer, a loss of earnings.

The amount of the benefit will be based on a sliding scale amounting to 38% to 60% of earnings up to a set threshold. The benefit per employee is based on gross earnings and length of employment. A benefit calculator will be available on the DEL website. The benefits will be available for a period of up to three months. The maximum amount of the COVID-19 TERS monthly payment will be R6,730. The minimum benefit will be R3,500 a month.

In order to limit the complexity of administration, any business employing more than ten people will be entitled to apply for the TERS benefit on behalf of its workforce. Bargaining councils will also be entitled to apply on behalf of employees represented by the council. In companies with fewer than ten employees, the employees themselves will be able to apply.

The applying employer or employer group is required to pay the benefit to employees within 48 hours of receiving the monies from the UIF. The UIF will have the right to audit any applying company.

Employers may supplement these benefits, but the maximum that an employee may receive from the UIF and their employer combined  is 100% of their salary. The employer must apply by reporting the total or partial closure to covid19ters@labour.gov.za. The employer will receive an automatic response outlining the application process and the documents and information that is required. 

A detailed set of question and answers on the TERS scheme can be found on the Business for South Africa website at https://www.businessforsa.org/c-19-ters-benefit-what-you-need-to-know/

Employees and Employers can access the Department of Employment and Labour COVID-19 TERS Guide for more information.

DEBT RELIEF FINANCE SCHEME

• For small and medium businesses which are negatively affected, directly or indirectly, due to the Coronavirus pandemic.

QUALIFYING CRITERIA

• The business must have been registered with CIPC by at least 28 February 2020;
• Company must be 100% owned by South African Citizens;
• Employees must be 70% South Africans;
• Priority will be given to businesses owned by Women, Youth and People with Disabilities;
• Be registered and compliant with SARS and UIF;
• Seda will assist micro-enterprises to comply and request for assistance must be emailed to debtrelief@seda.org.za;
• Whereas small and medium enterprises must ensure own compliance;
• Registration on the National SMME Database – https://smmesa.gov.za
• Proof that the business is negatively aected by COVID-19 pandemic;
• Complete the simplified online application platform;
• Company Statutory Documents;
• FICA documents (e.g. Municipal accounts, letter from traditional authority);
• Certified ID Copies of Directors;
• 3 months Bank Statements;
• Latest Annual Financial Statements or Latest Management Accounts not older than three months from date of application – where applicable;
• Business Profile;
• 6 months Cash Flow Projections – where applicable;
• Copy of Lease Agreement or Proof ownership if applying for rental relief;
• If applying for payroll relief, details of employees – as registered with UIF and including banking details – will be required as payroll payments will be made directly to employees;
• SMME employers who are not compliant with UIF must register before applying for relief;
• Facility Statements of Other Funders;
• Detail breakdown on application of funds including salaries, rent etc.

APPLICATION PROCESS

• Register on https://smmesa.gov.za/
• Complete online Application Form (to be released on Thursday, 02 April 2020);
• Upload Required Supporting Documents

For more information:

info@dsbd.gov.za/ info@mybindu.org.za| 0860 663 7867 or 0860 ONE STOP

BUSINESS GROWTH/RESILIENCE FACILITY

• For small, medium and micro businesses geared to take advantage of supply opportunities resulting from the Coronavirus pandemic or shortage of goods in the local market.

Qualifying criteria

1. The business must have been registered with CIPC by at least 28 February 2020;
2. Company must be 100% owned by South African Citizens;
3. Employees must be 70% South Africans;
4. Priority will be given to businesses owned by Women, Youth and People with Disabilities;
5. Be registered and compliant with SARS and UIF;
6. For non-compliant Micro businesses, Seda will assist them to comply and request for assistance must be sent to: growthfund@seda.org.za;
7. Registration on the National SMME Database: https://smmesa.gov.za/
8. Complete the simplified online application form available from www.dsbd.gov.za; www.sefa.org.za: www.seda.org.za
9. CIPC Registration Documents;
10. FICA documents (e.g. Municipal accounts, letter from traditional authority);
11. ID Copies of Directors/ members;
12. 3 months Bank Statements;
13. Latest Annual Financial Statements or Management Accounts not older than three months from date of application;
14. Business Profile;
15. 6 months Cash Flow Projections – where applicable;
16. Relevant Industry Certification – where applicable;
17. Estimations for funding requested.

Application Process

1. Register on https://smmesa.gov.za/
2. Complete online Application Form (to be released on Thursday, 02 April 2020);
3. Upload Required Supporting Documents

For more information:

info@dsbd.gov.za/ info@mybindu.org.za| 0860 663 7867 or 0860 ONE STOP

TAX MEASURES TO COMBAT THE COVID-19 PANDEMIC

Government has implemented interventions to assist with job retention and assist businesses that may be experiencing significant distress. These measures include:

The introduction of 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. This will help over 4 million workers;

The South African Revenue Service to 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 over the next six months. This intervention is expected to assist 75 000 small and medium term enterprises.

The above measures will be given legal effect in terms of two bills to be tabled when Parliament re-convenes later this year for retrospective enactment. These bills are the Disaster Management Tax Relief Bill and the Disaster Management Tax Relief Administration Bill. The draft bills alongside their draft explanatory memorandum, will be published for public comment on the National Treasury and SARS websites by 1 April 2020.

Together with the Commissioner of SARS, National Treasury will also be considering additional exceptional adjustments to assist with COVID-19 relief efforts and to the tax treatment of newly formed funds in this regard.

The draft explanatory notes regarding the COVID-19 tax measures can be found on the National Treasury (www.treasury.gov.za) and SARS (www.sars.gov.za) websites. Comments on the draft explanatory notes can be made to  2020AnnexCProp@treasury.gov.za.

PROPOSAL TO EXPAND EMPLOYMENT TAX INCENTIVE PROGRAMME

In order to minimise the loss of jobs during this critical period, Government proposes expanding the ETI programme for a limited period of four months, beginning 1 April 2020 and ending on 31 July 2020 as follows:

Increasing the maximum amount of ETI claimable during this four month period for employees eligible under the current ETI Act from R1 000 to R1 500 in the first qualifying twelve months and from R500 to R1 000 in the second twelve qualifying months.

Allowing a monthly ETI claim in the amount of R500 during this four month period for employees from the ages of:

18 to 29 who are no longer eligible for the ETI as the employer has claimed ETI in respect of those employees for 24 months; and

30 to 65 who are not eligible for the ETI due to their age.

Accelerating the payment of employment tax incentive reimbursements from twice a year to monthly as a means of getting cash into the hands of tax compliant employers as soon as possible.

This expansion will, however, only apply to employers that were registered with SARS as at 1 March 2020. Further to the above, the current compliance requirements for employers under sections 8 and 10(4) of the ETI Act will continue to apply.

Proposal of deferral of the payment of employees’ tax liability for tax compliant small to medium sized businesses

Tax measures for tax compliant small to medium sized businesses, for a limited period of four months, beginning 1 April 2020 and ending on 31 July 2020:

• Deferral of payment of 20 per cent of the PAYE liability, without SARS imposing administrative penalties and interest for the late payment thereof.
• The deferred PAYE liability must be paid to SARS in equal instalments over the six month period commencing on 1 August 2020, i.e. the first payment must be made on 7 September 2020.
• For the purposes of this proposal, small or medium sized business is defined to mean any business with an annual turnover not exceeding R50 million.

The above-mentioned proposals will not apply to an employer or representative employer that:

• has failed to submit any return as defined in section 1 of the Tax Administration Act, 2011 (TAA) on the basis required by section 25 of the TAA; or
• has any outstanding tax debt as defined in section 1 of the TAA, but excluding a tax debt in respect of which an agreement has been entered into in accordance with section 167 or 204 of the TAA;
• that has been suspended in terms of section 164 of the TAA; or
• that does not exceed the amount referred to in section 169(4) of the TAA.

However, interest and penalties will apply if the employer has understated the PAYE liability for any of the four months.

Proposal of deferral of the payment of provisional tax liability for tax compliant small to medium sized businesses

Government proposes the following tax measures for tax compliant small to medium sized businesses, for a period of twelve months, beginning 1 April 2020 and ending on 31 March 2021:

Deferral of a portion of the payment of the first and second provisional tax liability to SARS, without SARS imposing administrative penalties and interest for the late payment of the deferred amount;

The first provisional tax payment due from 1 April 2020 to 30 September 2020 will be based on 15 percent of the estimated total tax liability, while the second provisional tax payment from 1 April 2020 to 31 March 2021 will be based on 65 percent of the estimated total tax liability;

Provisional taxpayers with deferred payments will be required to pay the full tax liability when making the third provisional tax payment in order to avoid interest charges.

For the purposes of this proposal, a small or medium sized businesses is defined as any company conducting a trade with an annual turnover not exceeding R50 million. The eligibility criteria for individuals carrying on a business have yet to be finalised, but one possibility is that they will be eligible if their turnover is less than R5 million and no more than 10 per cent of their turnover is derived from interest, dividends, foreign dividends, rental from letting fixed property and any remuneration received from an employer.

The above-mentioned proposals will not apply to a provisional taxpayer that:

• has failed to submit any return as defined in section 1 of the Tax Administration, 2011 (TAA) as required by section 25 of the TAA; or
• has any outstanding tax debt as defined in section 1 of the TAA, but excluding a tax debt
• in respect of which an agreement has been entered into in accordance with section 167 or 204 of the TAA;
• that has been suspended in terms of section 164 of the TAA; or
• that does not exceed the amount referred to in section 169(4) of the TAA.

However, interest and penalties will apply in instances where, upon assessment, it is discovered that a taxpayer does not qualify for relief under the proposed amendments.

More information

• Explanatory notes for COVID-19 tax measures, 29 Mar 2020
• SMME debt relief finance scheme, 28 Mar 2020
• Business growth/ resilience facility – Guidelines for application, 28 Mar 2020
• Debt Relief Finance Scheme: Guidelines for application, 28 Mar 2020

BUSINESS FOR SA – MEMBER UPDATE – 1 APRIL 2020

GOVERNMENT LAUNCHES HOUSE-TO-HOUSE COVID-19 SCREENING 

President Cyril Ramaphosa announced on Monday that South Africa was now entering a new phase in the fight against Covid-19 and the government would be rolling out a screening, testing, tracing and

monitoring programme on a “huge scale”.

A total of 10 000 field workers will visit homes around the country scanning people for Covid-19 symptoms. Those found to have symptoms would be referred to clinics for testing. People with

moderate symptoms would be treated at home or at Covid-19 facilities, while those with serious symptoms would be transferred to hospitals.

President Ramaphosa also said that a mobile tracing system to track those who had come into contact with infected people and to monitor new cases would be set up, while a number of mobile testing

centres would be set up during April.

BUSINESS FOR SOUTH AFRICA URGES COMPANIES TO MAINTAIN SECURITY MEASURES DURING LOCKDOWN

On this page you can find knowledge resources for download for your business

UPDATE: Business Exemptions and Essential Good and Services

Essential Goods and Services – Categorization

Please refer to the PDF document, which is downloadable. It categorizes essential services and goods (check annexure B page 10), on the understanding of essential manufacturing and services.

Because the essential manufacturing activities are to continue to assist government in curbing the spread of the virus, with the enforcement of the lockdown, it will mean that no persons will permitted to move around without valid reasons and it is expected that SANDF will be enforcing this rule in all the key checkpoints. We are therefore requested to provide a list of suppliers in the sectors/ products declared as essential as per the PDF document. 

Please use the attached spreadsheet in excel, and populate should your sector be categorised as such.  

Also, for all companies listed as per essential services, kindly register on the following portal http://bizportal.gov.za. 

The site will be upload this morning.

Part 2
NB! LOAN FACILITIES – Affected companies can apply for loans. 

Please note the following generic email addresses to access the COVID 19 loan facilities:

• NEF – Email – covidfund@nefcorp.co.za Tel – 011 305-8888 
• IDC – covid@idc.co.za or 0860 693 888 or www.idc.co.za 
• SEFA – 0860 663 7867 and www.smmesa.org.za, applicants can register and apply for funding

Based on the broad categories that were announced by the President, a number of companies are already asking for exemptions from the lockdown requirements. A process is currently developed and will be shared once available.  Communication will be provided in due course.

Final Lock down regulations

List of Companies

6 Steps to apply for ‘business operating’ exemptions during lockdown period

Several  categories of business are able to remain open during the lockdown period, in order to provide crucial and essential products and services to South Africans.

This is how business-owners and management can apply for exemptions, and remain operational during the lock down.

1. Please send your e-mail/letter to Dr. Umeesha Naidoo – Acting Chief Director of Primary Minerals Processing  (UNaidoo@thedti.gov.za).

2. Reason for the Request

3. Products Produced

4. Number of People required

5. Measures to be put in place (eg. Transport)

6. Location of the plant

Contact Acting Chief Director of Primary Minerals Processing  (UNaidoo@thedti.gov.za).

MINISTER PATEL ANNOUNCES ESSENTIAL SERVICE APPLICATION PORTAL

The Minister of Trade and Industry, Mr Ebrahim Patel has announced that all businesses that will be allowed to provide essential services are required to seek approval from the Department of Trade, Industry and Competition (the dtic)  in order for them to trade during the period of the lockdown in terms of the regulations published today by the Minister of Cooperative Governance and Traditional Affairs, Ms Nkosazana Dlamini-Zuma in Regulation Gazette No. 11062

Such businesses are required to apply to the Companies and Intellectual Property Commission (CIPC) Bizportal website at www.bizportal.gov.za and obtain a certificate from the Commission that allows them to continue trading. The Bizportal website will contain a menu icon listed as “Essential Service Businesses” through which an application can be made to the CIPC.

The application will be a simple declaration requiring minimal registration details, type of business/trade involved in, what trading name if any is used an d whether it meets the requirements contained in the essential services list, the contact details of the person applying as well as the number of employees that will be working during the lockdown period.

The CIPC registry will then pre-populate the remaining company information and email a certificate stating that the business is allowed to remain trading.

The certificate can then be used as evidence to authorities requiring same that indeed the business has been given government permission to trade and that its employees are able to have unrestricted movement ONLY in the course of that trade.

It should be stressed and noted that if you make a false application to the CIPC, and are indeed not an essential service as per the government regulations, such will be taken as a fraudulent application and will render yourself as applicant liable to criminal prosecution and sanction.

This service will be available tomorrow morning 26 March 2020 at the start of business trading hours.

Enquiries:
Sidwell Medupe-Departmental Spokesperson
Tel: (012) 394 1650
Mobile: 079 492 1774
E-mail: MSMedupe@thedti.gov.za
Issued by: The Department of Trade and Industry

6 Steps to apply for ‘business operating’ exemptions during lockdown period

Several  categories of business are able to remain open during the lockdown period, in order to provide crucial and essential products and services to South Africans.

This is how business-owners and management can apply for exemptions, and remain operational during the lock down.

1. Please send your e-mail/letter to Dr. Umeesha Naidoo – Acting Chief Director of Primary Minerals Processing  (UNaidoo@thedti.gov.za).

2. Reason for the Request

3. Products Produced

4. Number of People required

5. Measures to be put in place (eg. Transport)

6. Location of the plant

Contact Acting Chief Director of Primary Minerals Processing  (UNaidoo@thedti.gov.za).