The health risks associated with the coronavirus, which is currently rampant worldwide, require increased protective measures in society and operations. You should therefore take precautions - for your employees, for your company and for yourself as an entrepreneur.
Measures by the tax authorities
- To ensure liquidity, taxpayers, who are evidently and significantly affected, can submit an application to reduce the advance payment with a brief indication of the current income expectations for 2020 to the tax authority (income tax and corporate income tax).
- On application, the tax offices in North Rhine Westphalia will set the special advance payments for permanent extensions of VAT for companies affected by the crisis down to zero.
- Facilitated deferral regulation for income tax, corporate income tax and Value Added Tax
- Here, you will find the application forms for tax relief due to the effects of Coronavirus
- The tax authorities waive enforcement measures and late payment penalties until the end of the year
- For details see Schreiben des Bundesministeriums für Finanzen (BMF) vom 19.3.2020 (Download)
- Pursuant to Sec. 19 para. 3 sentence 3 German Trade Tax Act (Gewerbesteuergesetz / GewStG), the tax office can initiate the adjustment of the trade tax prepayments for the current assessment period if it is aware of changed circumstances with regard to the trade income
- In this respect, taxpayers who are affected directly and significantly by Coronavirus may apply for a reduction of the trade tax base for advance payments until 31 December 2020 by indicating their circumstances
- These applications must not be rejected because the taxpayers cannot prove the value of the occurred damage in detail
- If the tax authority determines the trade tax assessment amount for the purpose of advance payments, the municipality concerned is bound by this when determining its trade tax advance payments (Sec. 19 para. 3 sentence 4 German Trade Tax Act (GewStG))
- For details see the identical decree of the supreme tax authorities of the federal states (download)
Value Added Tax (VAT)
- According to the Federal Ministry of Finance (BMF) there are measures regarding VAT pending:
- a prolongation of deadlines for advance VAT returns or
- a general changeover to quarterly advance VAT returns
Measures by other institutions
- The trade association food and catering (possibly other trade associations as well) offers the affected companies interest-free deferral of contributions
- The trade association will also suspend enforcement measures on deferrals of contributions
- The umbrella association of the health insurances (GKV-Spitzenverband) is currently negotiating with the health insurances and the associated external insurers (e.g. German Pension Insurance (Deutsche Rentenversicherung), Federal Employment Agency (Bundesagentur für Arbeit)) about payment reliefs of social security contributions. The companies are recommended to negotiate with the health insurances as collecting agency about deferrals, waivers on late payment fines or suspension of enforcement on a case-by-case basis.
Emergency aid for small enterprises
- Important note on the application
- The Corona Shield Programme complements the programmes of the federal states. Applications should therefore be processed from a single source in the federal states. They will announce which authority is responsible in each state. Applications should be submitted electronically wherever possible. The details of the actual application will be announced on the website of the Federal Ministry of Finance and updated on an ongoing basis.
- Overview of emergency aid
- An overview of the emergency aid subdivided according to federal states can be found here
KfW-Corona-Aid: Loans for companies
- The Federal Ministry of Economics has published a fact sheet on the KfW Special Programme
- KfW Entrepreneur Loan (037/047) for companies existing since more than five years
- If you apply for a loan for investments and equipment, KfW assumes a part of the risk of your bank. This increases the chance to obtain a credit commitment.
- Risk assumption of up to 80 % for large companies (037)
- Risk assumption of up to 90 % for small and medium-sized companies (047)
- You can apply for up to € 1 bn for each company group. The maximum loan amount is limited to 25 % of the annual turnover 2019 or twice the wage costs in 2019 or
- the current financing requirements for the next 18 months for small and medium-sized companies, resp. twelve months for large companies or
- 50 % of the total indebtedness of your company for loans exceeding € 25 mn
- ERP-Gründerkredit (ERP-start-up loan) – Universell (073/074/075/076) for young companies with an existence since less than five years
- If your company has been active on the market for at least three years, you can apply for a loan for investments and equipment. KfW assumes part of the risk of your bank. This increases your chances to obtain a loan commitment.
- Risk assumption of up to 80 % for large companies (075)
- Risk assumption of up to 90 % for small and medium-sized companies (076)
- If your company has been active on the market for less than three years, small and medium-sized enterprises (074) and large companies (073) can also apply for a loan for investments and equipment.
- Note: supplementary measures by the Federal Government are currently developed. We will inform you as soon as possible.
- KfW-Sonderprogramm (special programme) – syndicated financing as of € 25 mn. Direct participation for syndicated financing (855)
- KfW participates in syndicated financing for investments and equipment of medium-sized and large enterprises. KfW assumes up to 80% of the risk, but not more than 50% of the risks of the total indebtedness. This increases your chance to obtain individually structured and tailor-made syndicated financing.
- The KfW risk share amounts to at least € 25 mn and is limited to 25 % of the annual turnover in 2019 or twice the wage costs of 2019 or
- the current financing requirements for the next twelve months
- optionally, all banks participating in the consortium can be refinanced by KfW
- If you wish to use a credit guarantee, please contact the Bürgschaftsbank (guarantee bank) of your federal state
Recommendations for companies according to Bürgschaftsbank and NRW.Bank (guarantee bank and North Rhine-Westphalia bank)
- Determination of liquidity requirements
- Preparation of decision documents for banks, important are in particular:
- annual financial statement 2018
- provisional annual financial statement 2019, alternatively business assessment 2019 including trial balance
- brief description of the situation, explanation of measures taken
- provisional liquidity planning 2020
- profitability planning for 2020 and 2021
- Conducting a counselling interview, depending on the initial situation
- directly with the house bank (corporate client consultant)
- in advance with funding / financing advisors of the chambers
- with funding / financing experts of the Bürgschaftsbank NRW (guarantee bank North Rhine-Westphalia)
- Application of financing funds
- at the house bank, collaterized by theBürgschaftsbank / guarantee bank, if necessary
- direct application of a guarantee at the Bürgschaftsbank / guarantee bank
- Specific funding possibilities
- Silent partnership up to € 75,000 (micro-mezzanine fund) for liquidity financing
- Application through Kapitalbeteiligungsgesellschaft NRW (KBG NRW / Capital Investment Company NRW)
- A micro-mezzanine fund is available through KBG NRW. This fund provides up to € 75,000 of equity in return for a silent partnership. The fund is aimed at small companies, start-ups and special target groups (start-up from unemployment, training companies). Please find further information on the website of the Kapitalbeteiligungsgesellschaft NRW / Capital Investment Company NRW
- Up to € 2.5 million default guarantee to secure loans from house banks
- Application through the house bank, loans up to
- € 250,000 by express procedure (decision within three days after receipt of application)
- € 500,000 by circular procedure (decision within three days after submission of all documents)
Recommendations for companies
- The Sparkasse KölnBonn offers “Soforthilfe“ (immediate aid) – until KfW loans are granted – at a rate of 5.5 %
- The Bremer Aufbau Bank offers a liquidity subsidy that does not have to be paid back:
- Depending on the hight of the indicated liquidity bottleneck up to € 5,000
- In justified individual cases up to a maximum of € 20,000 with corresponding proofs
Federal Export Credit Guarantees (so-called Hermes Cover)
- A sufficient financing framework should be available for the Federal Export Credit Guarantees, which can be extended on short notice, if necessary. Hermes Cover can be applied for through the Portal of the Foreign Trade and Investment Protection of the Federal Republic of Germany .
Loss of earnings due to quarantine
- Anyone who is prohibited to work and thereby suffers a loss of earnings without being ill will receive compensation (Sec. 56 ff. German Protection against Infection Act (Infektionsschutzgesetz)). The Rhineland Regional Council (LVR) and Westphalia-Lippe (LWL) are responsible for North Rhine-Westphalia. If an employee is subject to quarantine measures without being ill, he/she receives continued payment of wages from his/her employer, who in turn can claim compensation from the Regional Council. The application must be submitted in writing to the Regional Council (Department of Social Compensation), enclosing precise evidence, within three months (!) as of the end of the work prohibition or the end of the isolation. Further information has been prepared by the Rhineland Regional Council on the website.
The following institutions supply further information
- Bundeswirtschaftsministerium (Hotline: 030 186 15 15 15)
- Wirtschaftsministerium NRW
- KfW Bank
- NRW.Bank: 0211 91741 4800
- Verband der Bürgschaftsbanken
- Steuerberater-Verband e.V. Köln (direct download of a PDF)
- Chamber of Industry and Commerce: Please contact regional representatives directly