First aid package of economic measures for the employees, companies and self-employed

The measure n.5 entered into force 27.3.2020. The Slovak Government and Parliament will endeavour to approve the other measures in an accelerated regime over the next few days. More information on measures from the Ministry of Finance (3, 6 and 7) are available HERE.

The first wave of economic measures to help the Slovak economy, which mainly concern legal entities, includes the following steps:

1. The refund up to 80 percent of employees' salaries of 1 100 EUR in obligatory closed companies. The First Aid for companies can reach up to 200 000 EUR, however, employee must not be in notice period.
2. Compensation will also be granted to the freelancers and employees in companies that have recorded the drop in revenues, i. e. businesses that are secondarily affected by the crisis. The amount of compensation will depend on the drop in revenues and the maximum amount of compensation may be up to 800 000 EUR per year.Business revenues will be compared with the same last year period. That means if a company records the drop in revenues more than 20 % in the period from 13 March 2020 to 31 March 2020 compared with the same last year period, the amount of the compensation paid to the freelancer / employee may reach in the total amount of 180 EUR, if the revenues drop by 40 % the compensation will be in the amount of 300 EUR, if the drop by 60 % the state will contribute with the amount of 420 EUR and if the revenues drop by 80 % the compensation of 540 EUR will be provided.For the purpose of compensation, the affidavit will be needed, however, after the end of the crisis, these revenues will be retroactively compared and reviewed.
3. Further, next measure is providing bank guarantees for loans in the amount of 500 million EUR on a monthly basis which should subsequently be provided by banks to businesses under advantageous conditions. However, the Slovak Government is still discussing details of the measure with banks.
4. Quarantine sickness status  is being introduced. There is an adjustment of the amount of the benefit, which will be 55% from the first day of the sickness leave and it will be paid by the Social Insurance Agency.Currently, it is stated that for the first ten days an employer pays for the sickness leave, where the first three days are based on the 25% of the employee´s daily assessment base and afterwards 55% of the employee´s daily assessment base. The entitlement is also assessed by the doctor for the new status.
    
   Emergency nursing is introduced. This means that a parent can receive a nursing benefit until their child reaches the age of 11, or until the child reaches the age of 18 if he or she has a long-term adverse health condition (for example, disabled). In these cases, no medical confirmation from the doctor will be required.The amount of the nursing benefit stay remains at 55% of the daily assessment base, with the possibility that parents will be able to take turns in receiving the nursing benefit. It is not necessary to apply for the prolongation of the benefit, only when the parents exchange in taking their nursing benefits.
5. Businesses that have suffered a more than 40-percent drop in revenues will be able to delay payroll deductions for their staff.
6. Deferral of income tax advance payments.
   Assuming that the drop in revenues will be more than 40 % in the month/quarter in which obligation of income tax advance payments arises compared with the same month of the last year period, the taxpayer:
   - May notify the Tax Authority by the affidavit that advance tax payments will not be paid in that month, resp. quarter.
   -Will be required to settle unpaid advance tax payments by filing the tax return for tax period of 2020 until the legal deadline for the tax return submission, i. e. until 31 March 2021.Please note that the affidavit must be submitted by the taxpayer to the Tax Authority for each month/quarter, in which the taxpayer applies for the deferral of advance tax payments. The deferral of advance corporate tax payments applies to all entrepreneurs, i. e. small-sized enterprises, freelancers as well as big companies regardless of the number of employees, amount of income, etc.
7. Extension of the possibility for deduction of the tax losses.
   Under that measure taxpayers will be able to deduct the forfeited tax losses reported in the tax periods 2014-2018 at once. The companies will be able to deduct the tax losses not yet claimed over the tax bases in previous years because of the insufficient tax base in previous years.Possibility to deduct the remaining part of tax losses from previous years is applicable in the corporate income tax return for the tax period 2019. The measure can be applied also by the taxpayers who have an economic year and the obligation to file the corporate income tax return within the period from 1.1.2020 to 31.3.2020.Taxpayers who have already filed a corporate income tax return for period 2019, can applied these measures by filing the supplementary corporate income tax return for the period 2019.Please note that losses eligible for offsetting in the tax year 2020 and later cannot be applied when calculating the tax base for 2019.

We will inform you immediately about the approval of individual economic measures and other details.