On 17 March, the Dutch government presented exceptional economic and tax measures to support businesses and workers. The measures are not only targeted at protecting our health, but also our jobs and income, and aim to protect freelancers, small and medium-sized businesses and large businesses against the economic emergency caused by the coronavirus outbreak.
The government has taken these measures in addition to the economic measures it announced on 12 March. Minister of Economic Affairs Eric Wiebes explained that the aid package is dynamic, and that the government will continuously assess whether the measures have to be scaled up or down, or extended. Practical clarification will be given if required.
The measures can be summarised as follows:
- Temporary Emergency Measure Job Security (NOW)
- Expected turnover losses of at least 20%
- Employees may not be fired for economic reasons throughout the subsidy period
- For a three-month period, employers may apply to the Employee Insurance Agency (UWV) for a wage cost allowance not exceeding 90% of the wage sum, depending on the turnover losses
- The Employee Insurance Agency will provide an advance payment of 80% of the amount requested
The NOW (Tijdelijke Noodmaatregel Overbrugging voor Werkbehoud) will be implemented as soon as possible and replaces the current Special Regulations for Reduction in Working Hours. Employers can apply for the allowance for a drop in turnover with retroactive effect from 1 March 2020.
- Additional support measures for self-employed entrepreneurs and freelancers
- For a three-month period
- Additional income support for living expenses for self-employed entrepreneurs and freelancers
- Income supplement up to the guaranteed minimum income
- No pay-back requirement
- No means or partner income test
Under this temporary scheme, support may also involve a loan for operating capital at a reduced interest rate.
- Dutch tax authorities ease tax deferral rules and lower penalties
- Deferral of payments of income tax, corporate income tax, VAT and payroll tax.
- Condition: within two weeks of a request for special deferral for tax payment being submitted, a deferral statement from a third-party expert (tax adviser or auditor) must be submitted to the tax authorities.
- Tax collection process is put on hold immediately
- No default penalties for late payments
- Evidence may be submitted later
- The late payment interest due on all tax payable will temporarily be lowered from 4% to almost 0%
- The tax interest rate for all taxes will temporarily be lowered to almost 0%
- Possibility to request reduction of the provisional tax assessment for corporate income tax or income tax remains
- Easing of Business Finance Guarantee Scheme
- Problems obtaining bank loans and bank guarantees
- For small and medium-sized businesses and large businesses
- 50% guarantee on bank loans and bank guarantees that qualify in terms of value
- The maximum value per company is temporarily scaled up to EUR 150 million
- Small businesses get interest rate rebate on microcredits Qredits
- Small businesses hit by the coronavirus crisis
- Six-month repayment-free period; and
- Interest rate automatically lowered to 2% for this period
- Temporary guarantees for agricultural and horticultural businesses
- Applicable to agricultural and horticultural businesses
- Temporary operating capital guarantee under the SME Agricultural Credits Guarantee Scheme
- Consultations on tourist tax (state/municipalities) and cultural sector
Consultations on putting on hold local tax assessments to entrepreneurs and on withdrawing local tax assessments imposed on companies, in particular tourist tax. This measure is being discussed and may not be implemented.
- Compensation scheme for specific industries that are hit
- Restaurants, bars, catering companies and
- Travel industry
- Compensation scheme for companies in these industries. This scheme is currently being drawn up and will be submitted urgently to the European Commission for state support assessment.
We follow all developments closely, and will keep you informed.
We are ready to help you assess whether these measures apply to you. If you need advice or have any questions, you can contact your tax adviser at AKD or send an email to email@example.com.