The Wage Subsidy clarified – Your Questions Answered

wage subsidy

**This information is correct as of 20 September 2021 and will be updated as more information becomes available.

The Government has approved another wage subsidy and is calling this Wage Subsidy August 2021 #3:

  • Applications for the first two rounds are now closed.
  • Applications for #3 close on the 30th of September 11.59pm.
  • The revenue test period for Wage Subsidy #3 is 14-27 September 2021.
  • You can apply on the Work and Income website as per the previous two rounds.


Wage Subsidy August 2021 #2.  

  • Applications for this second wage subsidy will open at 9.00am on Friday 3 September.
  • This is for all businesses and self-employed people who have or predict at least a 40% decline in their revenue from 31 August to 13 September and meet all the eligibility criteria.
  • If you applied for the first subsidy, you can apply for this second subsidy (providing you meet all the eligibility criteria) at least 14 days after your previous application. (For example, if you applied on the 23rd August for the first one, you can apply for the second one on the 6th September).
  • Early applications can’t be accepted as each payment is for two weeks.
  • If you didn’t apply for the initial wage subsidy you are still able to apply for Wage Subsidy #2 from 3 September providing you meet all the eligibility criteria.
  • To ensure payments are processed as quickly as possible, it’s very important the information provided in the application matches that held by Inland Revenue. If the information doesn’t match, it may delay the processing of an application.

More information on the second round can be found here.

Q: I’m an essential service and will be doing some work during the lockdown but there won’t be work for all my staff. Can I apply for the Wage Subsidy for all my staff or just those who aren’t working?

A: You can apply for all your staff, not just the people who aren’t working. You still need to meet the minimum revenue drop criteria requirements. Think of the Wage Subsidy as a ‘contribution’ to the weekly wage bill.

Q: How do we measure the drop in revenue easily or correctly, to ensure I’m compliant?

A: For the Wage Subsidy Scheme, you calculate the revenue for the 14 consecutive days between 17 and 31 August 2021. Then compare to a typical 14 consecutive days of revenue in the six weeks immediately before the move to Alert Level 4 on 17 August 2021 and work out whether there has been a decline of at least 40% and it’s due to the increased Covid-19 alert level. This is easiest done by running a profit and loss report from Xero and setting the dates accordingly. Make sure you keep a copy of the report to show the drop in revenue.

For the Resurgence Support Payment, the drop in revenue is at least 30% (this is different to WSS which is 40% decline) and due to the increase Covid-19 alert level. This time you the decline is comparing a 7 day period during the increased alert level to a typical 7 day revenue period in the 6 weeks prior to the increase from alert level 1.

The IRD have clarified what revenue means for the RSP. Revenue refers to income generating activity for example, daily takings for a restaurant or café; or for a business that invoices clients, this will be activities the business carried out that would entitle it to bill now or in the future, This definition is trying to provide clarity to, say a builder or plumber. If they have done no work during a 7 day period while in Level 4, then the revenue is $0 compared to work done in the comparison period.

We recommend that you check both the MSD and IRD websites for more information about the requirements and eligibility as well as information for seasonal businesses and groups.

Q: Do I need to pay my staff 80% of their wages or salary, or do I have to keep paying their full amount?

A: The WSS guidelines states that you must ‘use your best endeavours to pay your staff at least 80% of their usual wages. If this isn’t possible, you need to pay at least the subsidy rate (full or part time)’.  If the employee’s wages are less than the subsidy you receive, you must pay them their usual wages. Any difference should be used for the wages of other affected staff.

Q:  I have casual employees on my team, can I apply for the Wage Subsidy for them?

A: You can get the subsidy for your casual employees for their usual hours, and you must continue to employ them for the subsidy period.

Q: I’ve tried to apply but it’s asking for an NZ Business Number? What if I don’t have one because I am a sole trader or partnership?

A: All companies are automatically allocated a NZ Business Number on incorporation. We understand the the NZBN isn’t a required field for applying for the WSS or RSP. For sole traders and partnerships, you can find out more and apply for an NZBN here.

Q:  I applied for the first August 21 Wage Subsidy on 27 August 2021. I hear there is a second round of the subsidy opening on 3 September. Can I apply straight away?

A: You cannot apply straight away and need to wait at least 14 days from the date of your last application. In this case, you could apply for the second round on 10th September.


Please see separate information on the RSP.

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