Due to the Corona crisis, many companies have received subsidies in the form of Corona aid requested. Retail is particularly hard hit by the restrictions. But how do the subsidies affect the accounting and what do you have to pay attention to? Here you can find out everything about Corona aid for the self-employed and small businesses.
Table of contents:
- Important statistics on Corona aid
- What should you pay attention to when it comes to Corona help?
- Does Corona aid have to be paid back?
- What is the November and December aid all about?
- Corona aid for the self-employed and small businesses
Important statistics on Corona aid
The Credit Union for Reconstruction (KfW ) has expanded its special program for Corona aid and approved liquidity aid amounting to 47.47 billion euros at the end of 2020. KfW loans are intended for companies with more than ten employees and amount to a maximum of 800,000 euros.
Small companies, self-employed people and freelancers received emergency aid totaling 13.43 billion euros at the end of 2020.
Anyone who applies for emergency aid from the federal or state governments does not have to pay it back because it is an equitable benefit.
A repayment is only necessary if the liquidity bottlenecks are lower than originally assumed.
What should you pay attention to when it comes to Corona help?**
Corona-related subsidies play an important role for companies. The question arises as to how this support should be accounted for. The corona pandemic is a value-creating event - meaning that it occurred before the reporting date.
However, many companies find it difficult to classify subsidies and do not know how to report them in their annual financial statements. When it comes to the accounting treatment of grants, there are some important differences. Non-repayable grants can be collected in full.
Does Corona aid have to be paid back?**
The Corona emergency aid started in March 2020 and proved to be a lifeline for many small and medium-sized companies as well as the self-employed. However, the subsidies were only intended for those companies that were in a situation that threatened their existence.
The situation is currently still confusing. Anyone who has properly submitted an application for subsidies is not obliged to repay it. If you do not receive an official request for repayment, you do not have to take any further steps.
What is the November and December aid all about?**
The so-called November and December aid is extraordinary economic aid from the federal government that supports companies and self-employed people affected by the closures and restrictions from November 2, 2020. Anyone who had to put their work on hold from mid-December 2020 is excluded from the subsidies.
The maximum amount of the first payout is 50,000 euros. Self-employed people can request a payment of up to 5,000 euros via a direct application. Neither a tax advisor nor a lawyer needs to be involved as a third party auditor.
If you have already submitted an application for bridging assistance or expect a funding amount of more than 5,000 euros, you must hire a tax advisor, an auditor or a lawyer.
Corona aid for the self-employed and small businesses
The bridging aid in 2020 was actually only supposed to cover the months from June to August, but has already been extended twice. The bridging aid primarily supports small businesses, solo self-employed people and freelancers.
These are often people working in retail who are suffering particularly badly from the crisis. The following application deadlines apply: Bridging Aid II must be applied for by March 31, 2021, and you can request Bridging Aid III by August 31, 2021.
