Covid Crisis: 6 Ways the Government Will Aid Small Businesses
The South African government has offered to help small to medium-sized businesses who are suffering during the COVID-19 crisis.
All smaller businesses will have the chance to benefit from initiatives set up to bring relief to the economy in the wake of the 21-day lockdown.
Here are the types of relief available, and some essential details.
Department of Small Business Development Relief
A dedicated website for helping SMME’s (small, medium and micro-sized enterprises) went live last week. On the site, you can file for both financial and non-financial assistance. You’ll need to enter in a string of details, including employee and shareholder information and turnover stats. Non-financial assistance includes medical supplies, cleaning products and food items.
Enterprises offering essential services will have priority. If you register, you can expect to receive updates and alerts about future opportunities and market support measures.
COVID-19 Solidarity Fund
The government began this project with a R150 million donation, but the Solidarity Response Fund is actually crowdfunded. It asks for donations from the South African public and will focus on detecting and preventing the Covid-19 disease, caring for the ill and helping out those who have otherwise been affected by the crisis. Since starting up last week, several local billionaires and the National Lottery have donated considerable amounts of money towards assisting fellow citizens.
The fund will spend some resources on supporting small businesses. The Rupert and Oppenheimer families specifically have made sizable donations for patching up the economy. However, the details still need to be clarified. To donate, head over to the website’s landing page.
A Tax Holiday
Businesses that turn over less than 50 million a year can expect a tax holiday lasting four months. And unpaid taxes won’t accrue interest or penalties for the next six months. SARS has also promised to accelerate processing on tax returns. Some details have yet to be clarified, but you can read all SARS’ statements to date here.
Compensation Fund
The government’s Compensation Fund usually pays out compensation for employees who are injured or contract health problems on the job. Coronavirus cases are no different. If you’re an employer and you’re registered with the Compensation Fund, any workers who fall sick on the job will be supported during their illness via the Compensation Fund.
READ ALSO: Top 7 Best Small Business Funding Resources in South Africa
Department of Tourism
A sum of R200 million is available to help small businesses within the tourism industry. You can apply if:
- Your business turns over less than R2.5 million a year.
- You’ve been operating for a year or more.
- You’re tax compliant and are registered with the CIPC.
- Your business wasn’t experiencing problems before the Covid-19 crisis.
Black empowerment rules will be adhered to here, so black-owned business can expect preference when it comes to funding.
Bank Debt Repayment Delays
During this crisis, the government has allowed banks to no longer comply with rules from the Competitors Commission which state that competitors may not collaborate. Essentially, this means that our country’s major banks are getting together and coming up with ways to help people and businesses who are struggling. Plans are still being finalised, with most banks considering a holiday on loan repayments.
MoneyToday South Africa is a financial website aims to assist consumers with comprehensive information on personal finance, loans, insurance, investment opportunities, financial guides, tips and comparison of a large number of finance and insurance companies on the South African market.
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