Cash package for business in crisis
The article is updated on May 5th.
20 billion a month will be distributed, for March, April and May.
Read more on kompensasjonsordning.no
Those companies that can receive partial coverage of their fixed costs must be able to document a drop in revenue of at least 30 percent per month to receive support. For March, this represents a fall in revenue of 20 percent.
It will be optional for companies to compare revenue with:
- the same month in 2019
- average sales in January and February in 2020
The main rule is the same month for 2019, but the alternative with January / February 2020 will be especially relevant for those who have started after March 2019 and companies that have experienced significant growth in turnover during the period March 2019 - February 2020. Revenue is defined as the sale of goods and services. Other government grants received and income assurance provided in connection with the outbreak of viruses should be included in the month's revenue. Such arrangements may include, among other things, support schemes for the cultural sector and funds allocated by Innovation Norway.
To receive support, the cover amount (see formula below) must be at least NOK. 5,000, - and the maximum payment is 30 million.
As announced, no companies will have cover for all their fixed expenses, but a larger proportion of them.
The following items in the business statement (næringsoppgaven) believe NHO will be the ones that can be covered:
- 6300 Rent local
- 6310 Leasing car
- 6340 Light, heat
- 6395 Renovation, water, drainage, cleaning, etc.
- 6400 Hire machines, fixtures and fittings, etc.
- 6700 Foreign service (accounting, accounting, consulting, etc.)
- 6995 Electronic communications, postage and the like.
- 7040 Insurance and taxes on means of transport
- 7490 Contingents
- 7500 Insurance premium
- Interest expense. Included as an unavoidable expense are also accrued interest expenses on debt to banks and credit institutions and bond loans, less interest income on own loans, deposits and bonds.
– Everyone must take their share of the good fortune if we are to get through this in the best possible way. That is why we do not plan to cover 100 % of the fixed costs, says Minister of Finance Jan Tore Sanner.
He continues to say that the government expects companies to do everything they can to reduce costs, and that facility owners and others take their share of the responsibility, for example, in reducing rent.
The adjustment factor is 0.9 for companies that are forced to shut down by the government, and 0.8 for other companies. The latter group, ie those who are not required to keep closed, also receive a deductible of NOK 10,000 per month.
In other words, the companies that are required to remain closed will received a somewhat larger proportion of fixed expenses than companies in industries that are not closed down by the government, but still, struggle as a result of the crisis.
From the application month of April, it is new that the deductible for companies that are not shut down from the authorities, reduced from NOK. 10,000 to NOK 5,000.
This formula was presented in the press release:
Compensation = Decrease of revenue in percentage x (fixed costs - deductible) x adjustment factor
Company Optimisme AS is not closed by the government and has a decrease of revenue on 50 %, and fixed costs pr. month is NOK 100.000.
The coverage will be:
0,5 x (100.000 - 10.000) x 0,8 = NOK 36.000
You have to be a taxable company, but there are also some exceptions:
- Enterprises in the financial industry
- Enterprises in the production, transmission, and distribution of electricity and water supply
- Enterprises in the field of foreign maritime transport
- Enterprises within oil and gas extraction
- Private kindergartens that are under their own support scheme
- Airlines that are under their own support scheme
- Enterprises without employees (except ENK were the main source of income of the business owner)
- Enterprises without activity
- Enterprises that are undergoing bankruptcy proceedings
- Bankrupt enterprises
The content of this article is taken from regjeringen.no. Look here.
Need help applying or getting your application confirmed? You can either contact your regular accountant directly or fill out the form below and we will contact you.