Up until 31 May 2020 you can still apply for the Employment Bridging Emergency Fund (NOW). This is the fund which covers up to 90% of your wage costs in case of turnover loss, in order for you to keep paying salary to your staff. Below we discuss the most important aspects.
As this funding is a gift (not a loan), be sure to apply for it if you are eligible! In case of questions, feel free to contact Thijmen or one of his co-workers.
What is the NOW fund?
Due to extraordinary circumstances, like the coronavirus, you have less or no work for your employees. You can apply for this Employment Bridging Emergency Fund and receive a substantial compensation for their wages. In this way, you can continue to pay employees with permanent and temporary contracts. The Employee Insurance Agency (UWV) will pay you an advance.
What does the fund cover?
This is an emergency fund to cover a part of your salary costs, up to 90%. The higher your expected turnover loss, the higher the compensation. The following scheme applies:
- If the turnover loss is 100%, the compensation will amount to 90% of wages
- If the turnover loss is 50%, the compensation will amount to 45% of wages
- If the turnover loss is 25%, the compensation will amount to 22.5% of wages
The compensation is based on the so-called SV-loon, the social security salary. This should be mentioned on the monthly payslip. The government then adds 30% extra, to cover other wage-related costs, such as pensions and government premiums.
Finally, there is a maximum monthly wage of gross € 9.538,–.
How do I calculate turnover loss?
Turnover loss is based on your turnover of 2019. You divide the total turnover of 2019 by 4. Then you compare this amount to the expected turnover for the time period you’re applying for. The loss (in percentage) is the turnover loss used for this funding.
In case of group companies the turnover of the entire group is taken into account. Then, all separate (Dutch-based) entities should file themselves for this compensation, but must mention the same turnover 2019 and expected turnover loss 2020.
For concerns with Dutch and foreign subsidiary companies, only the entities that have a Dutch SV-wage should be taken in account to determine the turnover loss. So the turnover loss of entities without a Dutch SV-wage is not taken in account.
Group turnover loss below 20%?
You can still be applicable! The NOW ruling has been adjusted to benefit group companies. In case the calculation above leads to a group turnover loss below 20%, the separate entities with a turnover loss above 20% can still apply for NOW. The following additional conditions apply:
- You need a declaration from an Accountant, stating the group turnover loss is below 20%, but the turnover loss for the entity will be 20% or more.
- The business group may not pay out bonusses or dividend over 2020 nor may it buy its own shares
- The operating companies for which NOW is claimed must make arrangements on maintaining employment with trade unions or employee representation
- The applying operating company must be a legal entity in its own right
- An intra-group secondment operating company (personeels-bv) within the group cannot apply
Do I need a Dutch bank account?
The NOW ruling has been adjusted. You do no longer need a Dutch bank account, to receive this compensation.
Are all my employees taken into account?
The wages of both employees with a permanent contract as with a fixed-term contract are taken into account. Furthermore, the same goes for on-call employees or employees with a flexible amount of working hours.
The wages of employees who are hired through temp agencies or who are formally employed by external payroll-organisations are not taken into account. Compensation for their salaries can be applied for by the formal employer: the agency or payroll organisation.
For what time period can I apply?
You may ask for this compensation retroactively as from 1 March 2020. The compensation of wages will always be over March, April and May. The period of turnover loss can be changed. Normally it is based on the time frame March-April-May 2020. However, you may choose to move this up for 1 or 2 months, thus having the funding based on expected turnover loss over April-May-June 2020 or May-June-July 2020.
How much is the advance?
Based on your application, you’ll receive an advance of 80% of the expected compensation. The first advance payment is expected between 2-4 weeks after filing for the funding. The formal time frame for the government to decide on your application is 13 weeks. The actual turnover loss will be determined afterwards.
When am I eligible?
You are eligible if you expect a turnover loss of at least 20% for the 3 months you are applying for. Also, your company needs to be registered at the Dutch Chamber of Commerce as a Dutch entity. Furthermore you have to have filed your income tax information thus far timely, as this information is required by UWV.
What are the conditions?
- You are obliged to keep paying 100% of the salary for your staff
- You are not allowed to file for a dismissal on economic grounds during the funding
It is not necessary to keep your shop(s) open to the public. You can also apply for this funding if you’ve chosen to voluntarily close your shops.
How do I apply?
You can apply via a digital form on the website of UWV: www.uwv.nl. You have to mention the company name, loonheffingennummer (income tax number) and the bank account number on which you receive payments based on income tax. Furthermore you will need to take the following steps:
- mention the expected turnover for the 3 months you’ve asked the compensation for;
- compare this to 1/4th of the turnover of 2019;
- calculate the turnover loss in percentage based on this info This percentage is mentioned in the application form;
- if applicable: mention the file number for your previous WTV application (Reduction of Working Hours).
A separate application must be filed for every loonheffingsnummer (income tax number). If your company has multiple, you must file multiple applications. However, turnover is calculated for the entire group so make sure to mention the same turnover loss. Also you are bound to the same 3 months’ time period.
Is there anything I should do after filing for the funding?
Within 24 weeks after the funding period has ended, you need to file for the final compensation. You must add all relevant documents, amongst others a statement of your accountant, for the government to calculate the actual compensation. If based on these numbers you are still entitled to more compensation, you will receive this within 22 weeks after the filing for the final compensation. When determining the definitive compensation, a correction can be made if there has been a decrease in wages.
What if I had already applied for the former funding?
(WTV: reduction of working hour)
The NOW funding has replaced the WTV benefit. New application or prolonging the WTV benefit is no longer possible. If you had already applied for the WTV benefit, the following applies.
If you did not receive approval for this ruling, your request is automatically transferred to the new ruling. You will be requested to provide more information with regards to the new ruling.
If you already received approval this would have been for 2 – 6 weeks. After this time period, you can apply for the new NOW funding. Be aware you will have to pay the 100% of the salary again. Of course, you are also allowed to schedule your staff to work for the normal amount of hours as well. Prolonging the WTV funding is no longer possible.