Coronavirus: RSM advises on financial & economic changes

Part of the third emergency package is the Third temporary emergency bridging measure for maintaining employment, fourth tranche, abbreviated as NOW 3.2. In this newsletter we describe the key elements of NOW 3.2. 

In its letter of 21 January to the Lower House of Parliament, the government set out the extension of the economic aid and recovery package in connection with the corona crisis.

Recently, the Ministry of Social Affairs and Employment (hereinafter: SZW) has published on its website its position on which companies, within a group, the so-called bonus and dividend prohibition applies, as well as the prohibition of share buy back schemes. Such prohibitions generally apply to applicants for NOW and/or (nonapplicant) group companies.

Update December 14th 2020 - On 9 December 2020, the Ministry of Economic Affairs and Climate announced adjustments to the economic support and recovery package. These adjustments mean that under NOW 3.0 the previously proposed reductions will be frozen.

Update 14 december 2020 - We earlier reported on the extension of the special deferral for tax payments as a result of the corona crisis. You can read about that here. The option to apply for an extended deferral was later extended.

The TVL is an allowance for fixed costs for companies that are economically affected by the corona crisis. After an initial compensation period (June to September 2020) for companies in a limited number of industries, the TVL has been extended, increased and made available to nearly all sectors in Q4 2020 and Q1 2021.

The Covid-19 pandemic, unprecedented economic downturn and widespread uncertainty are a few of the global themes that have characterized 2020. We hope that this article can serve as a point of departure to help companies address the uncertainty in their businesses which has been caused by the pandemic and economic downturn. 

On August 28, the Dutch government informed the Dutch parliament on the so-called emergency package 3.0 in connection with the corona crisis. The measures from the third emergency package are designed to support companies and employees with the economic consequences of the measures against the corona virus.

Many family businesses come out of the corona crisis stronger than they thought they would at the beginning of the crisis, a comparison of the research results of the RSM-Nyenrode Family Business Research Panel shows, which study was carried out in July. More than 65 percent of the same group of respondents said they were more optimistic about their company's chances of survival in July compared to the situation in April 2020. In April 2020, family businesses feared an average loss of turnover of 36 percent compared to April 2019. Now, in June 2020, it appears the loss of turnover will only be three percent compared to the same period last year.

The Dutch Ministry of social affairs and employment has offered the second package of the  temporary arrangement compensation labor costs (“NOW 2.0”) to Dutch parliament. In this alert an overview of the most important items in this second package are provided together with a high level overview of some of the differences between the NOW 2.0. and the NOW 1.0.

As of 17 March 2020 entrepreneurs could request for special postponement of tax payments. The extension is generally for a period of three months. After this period, the tax authorities will start collecting tax debts due. The term of extension will or has in some cases already expired. Time to act.

On May 20, 2020 the Dutch government sent a letter to Dutch parliament with details on a second COVID-19 support package. The measures from this letter are aimed to provide continuous support to companies and employees that are economically impacted from the restrictive measures meant to limit the spread of the virus. Most of these measures known from the first support package are now extended with some amendments but some new measures have also been announced. In addition, the Dutch Minister of Social affairs and employment informed Dutch parliament on May 20, 2020 on some changes that will be made to the temporary arrangement compensation labor costs rules (“NOW”).

Recently the government has announced a new measure that allows for the possibility to carry back an expected tax loss for 2020 by creating a ‘corona reserve’ in 2019. This is an interesting new measure although it is subject to certain restrictions. 

A little more than two months ago COVID-19 hit the world stronger than we ever expected. The world has changed forever. In this newsletter we provide an overview of the latest developments in the financial sector around dealing with COVID-19 and its effects, as well as the responses of (inter-)national supervisors in the financial sector.

By letter of April 24, 2020, the Dutch Secretary of State for Finance announced six new tax measures related to the COVID-19 crisis. The details of the measures will be further elaborated by the government. The measures are intended to take effect as soon as possible. Below we provide an overview of these measures.

The 270,000 Dutch family businesses, like many other companies, have been struck hard by the coronacrisis. The family businesses expect an average turnover loss in April 2020 of 40% compared to April 2019. Already 22% of last year’s profitable family businesses do not expect to make a profit. They expect to make a loss for the whole of 2020. This is evident from the results of the RSM-Nyenrode Family Businesses research panel from early April 2020. This also shows that family businesses do everything they can to keep their employees employed and that they are optimistic about the future.

Public policy measures put in place to contain the spread of Covid-19 are resulting in significant operational and financial disruption for companies. Staff quarantine, supply chain failures and sudden declining demand from customers are causing multiple issues for companies in all sectors.

The COVID-19 virus (corona) leads globally to substantial concerns and has huge impact on the daily business. In many nations a (semi or total) lockdown situation has been implemented or is expected in due course. The current situation impacts financial institutions and their clients substantially.

It was announced recently that the ‘temporary arrangement compensation labor costs’ (“NOW”) will replace the ‘part time unemployment benefits measure’ which was terminated. The NOW legislation and additional guidance has been published on March 31, 2020.

The COVID-19 virus (corona) leads globally to substantial concerns and has huge impact on the daily business. In many nations a (semi or total) lockdown situation has been implemented or is expected in due course. The current situation impacts financial institutions and their clients substantially.

As we are all aware, The COVID-19 (Corona) virus has far reaching consequences for daily life world wide. Several EU Member States have prohibited events or public gatherings.

In this time of the coronavirus, it is important to pay extra attention to your company’s liquidity position. What can you do to maintain a healthy liquidity position and what options do you have if this position is compromised? We would like to inform you about these matters and can provide you with relevant advice and support, of course.

On Tuesday evening 17 March 2020, the Dutch government announced new and adjusted measures in order to support Dutch businesses, employees and self-employed persons. The measures are an addition to the measures already announced on 12 March 2020. The measures among others support self-employed persons and support businesses in continuing paying their employees.

The Dutch and international business community will be significantly affected by the coronavirus. The financial and economic consequences may also be considerable. As a result, in its letter of 12 March 2020, the Dutch government announced a number of measures that will hopefully give businesses some room to deal with the developments.