Entrepreneur: this is how you prepare for applying for the second round of business cost subsidy
The second round of business cost subsidy will be open for applications at the end of December. This is a continuation of the summer’s business cost subsidy round, which ended on 31 August.
The business cost subsidy is intended for businesses whose turnover has decreased because of the COVID-19 pandemic. It is intended for costs such as payroll and rent.
In the second round, the terms of the subsidy are being changed, including the removal of the minimum turnover threshold. The subsidy period is being extended to five months.
In the first subsidy round, the subsidy period (the period for which the business provides information on turnover) was two months (April and May). In the second round, the subsidy period would be from 1 June to 31 October.
According to the Bill currently going through Parliament, a business can apply for the subsidy even if it has already received other direct coronavirus-related payments. However, other payments granted are considered, and a business cannot receive more than €800,000 in subsidies and support in total.
Like last time, businesses will apply for the funding to the State Treasury, which will announce more details about the start of applications shortly. The State Treasury believes it can start processing applications as soon as the Bill is passed into law and the Government’s Decree on the sectors concerned is issued and enters into force at the end of 2020.
The communications department of the State Treasury and Petri Malinen, an economist at Suomen Yrittäjät, can advise business owners on applying for the second round of the subsidy.
Grant a mandate on Suomi.fi
With a Suomi.fi mandate, someone with the right to sign for your business or an authorized person can apply for the subsidy on your behalf. In this case, you must ensure that the right people are entitled to sign for your company. You should also check that you can grant mandates on Suomi.fi.
Your authorized person applies for the subsidy using the “Applying for corporate financing” mandate. You must have a business ID (Y-tunnus) to apply for the subsidy.
When you first give or request a mandate, first choose the assignee: either a person or a company. Then choose the mandate purpose: the matter in which the assignee can act on your behalf. Finally, choose the period the mandate will be valid for. When you grant a mandate, it is in force from the date you set as the start date. When you request a mandate, it only enters into force when the assignor confirms the mandate request.
A mandate is an electronic authorization and the data in it are stored in the Authorization Register. When you want to act on someone else’s behalf on websites that use the Suomi.fi mandates, your right to use the mandate is verified in the Authorization Register.
Check the bank account number you have given to the Tax Administration
Business cost subsidy can only be paid to a bank account that a business owner has registered with the Tax Administration. Use MyTax (OmaVero) to check the account number you have provided, and to update it if necessary.
Evaluate your business’s situation and turnover
You should assess whether the sector of the economy you operate in has been broadly hit by the pandemic. In general, to receive the subsidy, the entire turnover of the company’s primary operating sector in the subsidy period must have declined by 10% compared to the comparison period.
Next, you should assess whether your company has suffered so badly from the COVID-19 pandemic that its turnover declined by 30% in the subsidy period compared to the same period in 2019. (For companies registered on or after 1 May 2019, the comparison period is 1 January–29 February 2020.)
Estimate your company’s costs
A company can write its estimate of the costs covered by the subsidy in its application. These are costs that the business cannot affect, even if it has less business, and sales decrease. Depending on the business, fixed overheads can be very different. Such costs include rent and other outgoings on property the business uses, such as machinery and equipment rental, royalties, licence fees and the cost of essential temporary workers. Costs such as materials, supplies, new investments and payroll that can be reduced are not eligible for subsidy.
File VAT on time
You can speed up payment of any business cost subsidy by filing your VAT return to the Tax Administration in good time.
Photo: Getty Images
pauli.reinikainen (at) yrittajat.fi