The text Details of the second tranche of the NOW scheme have been announced. In the letters to Parliament, this scheme is also referred to as NOW 2.0. This name suggests a revised scheme, but in practice the scheme has only been amended in a few respects.
NOW 2.0
The changes in NOW 2.0 compared with NOW 1.0 are:
- the grant period is being extended from 3 to 4 months (NOW 1.0 covers the months of March, April and May 2020; NOW 2 covers the months of June, July, August and September 2020);
- the flat-rate surcharge on the wage bill will be increased from 30% to 40%;
- A company that receives more than €125,000 in grant funding (or more than €100,000 in advance payments) may not distribute any profits for 2020, may not buy back its own shares, and may not pay bonuses to the board and management (under NOW 1.0, this applies only to groups applying for the grant on behalf of an individual company);
- the employer has a duty to use its best endeavours to encourage employees to undertake further training and retraining;
- In the case of larger redundancy applications, the total subsidy amount is reduced by 5% (under NOW 1.0, there is an additional deduction of 50% from the wage bill of the redundant employees)
- NOW 2.0 does not contain any separate provisions for seasonal businesses or other employers whose total wage bill during the measurement period is higher than that during the reference period.
Request
The NOW 2.0 scheme is open both to business owners who have already received NOW 1.0 support and to new applicants. Entrepreneurs who have already received support under NOW 1.0 must ensure that, for NOW 2.0, the period over which the loss of turnover is calculated corresponds to the choice they made for NOW 1.0.
Applications can be submitted between 6 July 2020 and 31 August 2020. As with NOW 1.0, applications are made using a form via the website from the UWV.
Applicants will once again receive an advance payment of 80% of the expected grant amount. This advance payment will be paid out in (up to) two instalments (the advance payment under NOW 1.0 was paid out in up to three instalments).
Applications for the settlement of subsidies may be submitted to the UWV from 7 October 2020. Separate applications may be made for NOW 1.0 and 2.0.
Look before you leap
NOW 1.0 and 2.0 are designed to enable business owners to retain their staff during the period in which the coronavirus crisis is having an economic impact. Ultimately, however, these business owners will have to stand on their own two feet again. Minister Koolmees has indicated that support will end after NOW 2.0. This means that, after 30 September 2020, business owners will once again have to manage financially entirely on their own.
It is therefore important for business owners to carefully assess:
- the financial position of their business at the end of NOW 1.0 (30 June 2020);
- what (financial) outlook they foresee for the coming months;
- and to what extent these months can be covered, including through the NOW 2.0 scheme;
- what financial obligations remain after September 2020 (settlement of NOW 1.0 and 2.0, taxes for which a deferral of payment has been granted, as well as other obligations such as deferred rent payments);
- what alternatives are available.