admin Mar 17, 2020
We are currently dealing with the topic of corona virus. Many SMEs are hit very hard by the national and cantonal emergency measures, which have peaked with yesterdays’ decision of the lockdown. The consequences are not yet foreseeable. We therefore feel committed to SMEs in Switzerland and have compiled all currently known support measures for you in the blog below (as of March 17, 2020).
Short-time work
What is short-time work?
If an extraordinary situation, such as the current coronavirus, leads to a loss of working hours of more than 10% for employees, this is called short-time work. In order to compensate for the loss of wages and to avoid dismissals, the unemployment insurance fund can help out with short-time work. Normally, a waiting period of 10 days applies here.
In the current situation, this period has been reduced to one day (valid until 30 September 2020). This means that SMEs only have to cover the costs of short-time work for one day. In addition, the entitlement to short-time work compensation has also been extended to persons in a fixed-term employment relationship, persons in an apprenticeship, persons in the service of an organisation for temporary work and persons in an employer-like position.
How do you apply for short-time work?
Notification is made to the responsible cantonal authorities (usually the Directorate of Economic Affairs) using the pre-notification form. Employees must explicitly agree to short-time work. You can find additional information here.
COVID-19 bridging loan
What is a COVID-19 bridging loan?
As the Swiss government announced on 25 March, SMEs and start-ups can now apply for a bridging loan. This measure is intended as liquidity aid to prevent companies from getting into payment difficulties during the Corona crisis. For loans of less than 500,000 Swiss francs, 100 percent of the loan is backed by the federal government, for loans of 500,000 to two million Swiss francs, 85 percent by the federal government and 15 percent by the borrower's bank. The loan must be repaid within 5 or in exceptional cases 7 years. Loans up to 500,000 Swiss francs do not bear interest, above that the interest rate is 0.5 percent.
Who can apply for a temporary loan?
All SMEs and start-ups which had to close down their businesses due to the current situation or which are experiencing a sharp drop in demand can apply for a bridging loan. A loan can be applied for up to a maximum of 10 percent of the annual turnover. Companies with an annual turnover of more than 20 million Swiss francs are excluded from this rule.
How do you submit an application for the transitional credit?
The loans are granted by the company's house bank (also PostFinance). To submit an application, a form must be completed and sent by e-mail or post to the respective house bank. You can download the form here.
Other options
The following additional measures were decided upon to help companies with payment difficulties to bridge this difficult period:
- A temporary interest-free deferment of payment of social security contributions (AHV, IV, EO, ALV) can be requested. Companies also have the option of having the amount of the regular contributions on account adjusted to the AHV/IV/EO/ALV if the sum of their wages has fallen significantly.
- In the case of VAT, customs duties, excise duties and incentive taxes, the government will waive interest on arrears from 21 March 2020 to 31 December 2020 if companies apply for a longer payment period. The same applies to direct federal tax.
Self-employed
The Federal Council has also adopted measures to compensate self-employed persons who suffer loss of earnings as a result of the Corona crisis. They will receive a daily allowance if they have to close their own business that is open to the public, if they have to go into a medically prescribed quarantine or if they have to look after their children due to school closures.
In order to receive the daily allowance, those affected must submit an application. The Compensation Office is responsible for advice and payment, with which the persons concerned settle their AHV contributions. Self-employed persons entitled to the income rate receive 80% of their average income or a maximum of 196 francs per day. Further information can be found on the AHV website.
In addition, affected self-employed persons, can apply for an interest-free deferral of social security contributions (AHV/IV/EO/ALV).
Hardship solution
Unfortunately, despite these measures, certain self-employed people still fall through the cracks. This particularly affects those who are confronted with a loss of income due to the widespread stagnation of the economy, although their work is not prohibited and they are therefore not entitled to corona compensation. For this reason, the Federal Council has instructed the EDI (BSV), together with the EFD (EFV) and the WBF (SECO), to examine support in the sense of cushioning hardship cases for the self-employed until 8 April 2020.
Private insurance (example based on information of an insurance company)
Epidemic insurance
The specific epidemic insurance covers the damage caused by the closure. Prerequisites for insurance protection are measures ordered by the responsible Swiss authorities to prevent the spread of communicable diseases that lead to the closure of businesses or parts of businesses.
Property insurance
Property insurance does not cover compensation because there is no property damage.
We still recommend that you check with your insurance company regarding any coverage. This depends heavily on the insurance company or company with which the policy was concluded.
It remains to be seen whether the measures currently decided will suffice. However, we believe that the Federal Council has recognized that without accompanying measures, the economy would be adversely affected. We very much hope that the swift and unbureaucratic measures can mitigate the most negative effects on the Swiss economy
New short-term loan at Crowd4Cash for SME liquidity
Crowd4Cash tries to remedy this with the short-term loan for SMEs. Together with a partner company, we are now offering SME loans of up to CHF 250K and a term of up to 12 months. Contact us for further details.
Sources:
SECO communication «Coronavirus measures»
https://www.baloise.ch/de/ueber-uns/coronavirus.html#anchor-id-93a0
