Tax Coordination for Employees who Returned from Unpaid Leave
Aid Grant for the Self Employed – Coronavirus Crisis
Starting Sunday 3.5.2020 until 17.7.20 (for 70 days), you may apply for a Coronavirus Crisis Aid Grant in the Tax Authority website:
The eligibility of applicants will be clarified upon completing the request, except for rare cases. Please find attached the regulations.
The layout includes:
- Fixed expenses grant for small businesses – 5.2 billion NIS. The grant is aimed for covering fixed expenses of small business with a turnover of up to 20 million NIS, whose sales volume was significantly hit in March-April. Nonprofit organizations which are recognized as public institutions also eligible for this grant. A business may receive up to 400K NIS, depending on the decrease in its activity. The grant will be paid by the Tax Authority in May.
- Aid grant for the self-employed – 2.8 billion NIS. Following the first round in April, the grant will be provided for self-employed persons whose business has decreased by at least 25% in March-June. The grant will be paid directly into the bank account. It will amount to 70% of the average monthly taxable income and up to a sum of 10,500 NIS.
Employed controlling personnel are eligible for the grant as well.
Quick Support Grants Channel for R&D of Technology Companies in Crisis
Property Tax Discount
Brooks-Keret PPP update related to US Companies
We at Brooks-Keret keep monitoring the latest developments in the US due to the current COVID-19 crisis and at this point we’d like to update you regarding a specific benefit offered as part of the stimulus package announced earlier by the US government, Paycheck Protection Plan (PPP):
The Small Business Administration (SBA) is administering a new programs to provide loans of up to $10 Million for qualifying small businesses, along with an opportunity for future loan forgiveness.
The maximum loan amount is 2.5 times the business average monthly annual payroll cost for the preceding 12 months, or $10 Million, whichever is less. No personal guarantee is required.
Loan proceeds may be used to pay for the following expenses:
- Payroll costs
- Interest on debt obligations incurred before March 1, 2020
Payroll costs are capped at $100,000 on an annualized basis for each employee.
The loan amounts will be forgiven as long as:
- The loan proceeds are used to cover payroll costs, and most mortgage interest, rent, and utility costs over the 8 week period after the loan is made; and
- Employee and compensation levels are maintained.
Partial forgiveness may also apply. Forgiven amounts will not be included in the company’s taxable income.
Brooks-Keret Updates related to US Companies due to COVID-19
Brooks-Keret stands by you during these uncertain times, as the world is challenged with the impact of COVID-19. In this email, we would like to notify you of the following updates, related to US companies:
Tax return due date
On Friday, March 20th, the US Treasury has announced that the tax filing deadline has moved from April 15th to July 15th, for both corporations and individuals. This announcement follows an earlier announcement to delay the 2019 tax payments to July 15th.
Some of the states have already announced they will follow the federal deadlines (NY, CA, IN, OR, MD). Not all states have made such an announcement but e believe it is likely that they will do so shortly.
We will keep monitoring the situation and update you as new relief is announced.
We at Brooks-Keret are working with each client’s US CPA to assure timely filing.
*** Please note that the information detailed hereafter does not constitute professional legal advice. You are welcome to reach out to us so that we can refer you to proper consultation ***
Last week, the US government has released the Families First Coronavirus Response Act, which will take effect on April 2nd. The law is a plan aimed at addressing the impact of the COVID-19 outbreak on Americans and introducing paid sick leave and an expanded family and medical leave act to the nation’s employers. Some of you may have already received information about this new act from your payroll providers. However, the Secretary of Labor is expected to set specific legislation regarding this act and it is expected that this law will not apply to small business, to be more specific, companies with less than 50 employees.
At Brooks-Keret, we will monitor the legislation and will advise as new rules are announced.
For now, the only requirement for small employers is to follow their sick leave policies, if they have any in place, or follow the state mandated sick pay laws, where applicable (CA, NY, MA, NJ).
Companies looking to mitigate expected losses due to the crisis and cut back on payroll expenses have a few options, among them are reduction-in-force (either temporary or permanent layoffs), furloughs, and reduction in hours and/or pay.
When making any such step, the following considerations must be taken into account:
* The criteria for employees’ who’s employment is changed/terminated must be objective and implemented across the board.
** Exempt employees (that is, exempt from over time payment under the federal FLSA or state adopted law) must be paid their regular weekly pay for any week in which they were working, even if only partially, otherwise their exempt status is compromised.
*** Employees must work a minimum of 30 hours per week in order to be eligible for benefits.
Note that Unemployment pay is mandated per state’s rules and regulations and are paid up to the state’s maximum amount. Benefits could differ between the states.
Most states however have waived 2 main requirements for unemployment pay –
- The 7 days waiting period before unemployment benefits apply
- The requirement to proof the terminated employee is actively seeking another job.
Partial unemployment payments are also available, in case both hours and pay are reduced, however it is only paid if the portion of the pay paid by the employer does not exceed the state’s maximum benefit.
We at Brooks-Keret will keep monitoring any new legislation and will update you with any major changes.
We hope you and your families are safe and well. We are here to support you with any challenges you are now facing.
Brooks-Keret Benefit Packages to Support Startups at Corona Virus Times
For Additional information- https://brooks-keret.com/bk-digital-automated-digital-financial-management/
The program is in partnership with Microsoft, IBM and Salesforce and is up to a period of one year or a financing round/significant sales – the earlier of the two.
- Professional Bookkeeping & Payroll at very attractive rates (ILS 650-850 per month)
- Budget preparation at 50% discount
- CFO Mentoring
- Pitch Preparation
- Tech Consultant
*Decision is made upon an internal committee
- A financial package reporting to their investors (P&L, BVA, Balance Sheets)
- Management reports such as cash flow / forecast cash flow / burn rate
- Reports to IIA (Israel Innovation Authority)
- 20% discount on all our services (CFO, Controlling and Reporting, Bookkeeping, Payroll, Admin)
- 50% discount on budget preparation
- 10% discount on our US financial services
- Connection to additional investors / VCs
- Convenient payment terms
- Director of Finance / Controller
- Payroll Controller
Brooks-Keret Emergency Assessments Following the Corona Virus
- Placing employees unpaid vacation.
- Attached you can find a legal document related to the labor laws specifically for this period, written by Adv. Orit Ra’anan. corona epidemic