Lockdown revenue compensation, December 2020

The guidelines on granting a lockdown revenue compensation for companies directly affected by the lockdown (so-called December lockdown revenue compensation) were published on 17 December 2020 and updated on 28 December 2020. In the following entry, we provide information on the key points of the updated guidelines:

To provide those sectors in Austria that have been affected by the most recent lockdown restrictions with support as quickly and directly as possible, the Austrian Federal Government introduced compensation for revenues lost due to the lockdown (lockdown revenue compensation) as an immediate grant. Restaurants, hotels and other sectors directly affected by the lockdown were able to apply for lockdown revenue compensation from 6 November 2020. From 23 November 2020, lockdown revenue compensation was also made available to sectors subject to later closures, including retail and services requiring close physical contact. The application deadline was 15 December 2020. Directly affected companies can now apply for additional lockdown revenue compensation for the extended period of closure in December 2020, starting 16 December 2020 (so-called ‘December lockdown revenue compensation’).   The corresponding guidelines were published on 17 December 2020 and updated on 28 December 2020.

• • Beneficiaries are companies that cumulatively fulfil the prerequisites under the lockdown revenue compensation guidelines in the assessment period, such as e.g. legal seat or permanent establishment in Austria, or being directly affected by the restrictions under the COVID-19 protective measures.
  • Affected sectors include, for example:Hospitality, accommodation providers, leisure facilities, services requiring close physical contact, retail. Allocation to the relevant sectors must be made in accordance with the ÖNACE-2018 classifications.
  • Not eligible to apply are, for example, companies for which insolvency proceedings are pending in the assessment period (except for reorganisation proceedings) or newly established companies, which have not generated any revenues prior to 1 November 2020.
  • The assessment period for lockdown revenue compensation is the period in which the applicant is directly affected by the measures. The assessment period ends on 31 December 2020 at the latest.
  • The amount of lockdown revenue compensation corresponds to 50% of the revenues to be determined, except for retail companies, for which 12.5%, 25% or 37.5% rates apply.
  • To determine the applicable percentage rate for retail companies, a standardised model is used to calculate typical sector gross profits, a ‘knock on’ effect observed following similar measures in the spring, and the effect on the saleability of goods (seasonal nature, perishability). The gross profits are double weighted when assessing the individual criteria.
  • The minimum amount that can be granted is EUR 2,300, although if the assessment period is less than one week (7 days), the minimum amount is EUR 500. If the maximum amount under laws on state aid is less than minimum amount, only the EUR 500 amount can be granted.
  • The lockdown revenue compensation is capped at EUR 800,000 minus any subsidies received, such as in particularly lockdown revenue compensation for November, the fixed costs subsidy II of up to EUR 800,000, 100% guarantees for credits from aws or ÖHT, payments from Austrian federal states, municipalities, or regional economic or tourism funds in connection with the COVID-19 crisis, as well as subsidies from the NPO support fund, which constitute limited state aid.
  • The amount of lockdown revenue compensation will not be reduced by other subsidies from the NPO support fund; 90% or 80% guarantees provided by COFAG, aws, or ÖHT; fixed costs subsidy I; subsidies from the hardship fund; as well as short-time working subsidies.
  • When calculating the amount of lockdown revenue compensation, the applicant’s revenues in the comparison period of December 2019 must be used. The tax authorities have multiple options to calculate the amount of the revenue shortfall, including the revenues in the monthly VAT returns for December 2019.
  • Lockdown revenue compensation cannot be granted if the fixed costs subsidy II of up to EUR 800,000 was claimed for the December assessment period. If the fixed costs subsidy II of up to EUR 800,000 was applied for prior to the date on which the guidelines on lockdown revenue compensation for December were issued, it is still possible to apply for lockdown revenue compensation if the applicant undertakes to repay to COFAG the fixed costs subsidy II of up to EUR 800,000 on a pro-rata basis for the December assessment period. At the latest, the repayment must be made in the course of the payment of the second instalment of the fixed costs subsidy of up to EUR 800,000, with crediting being the preferred method.
  • Lockdown revenue compensation can also not be granted if compensation for losses was claimed for the December assessment period. If compensation for losses was applied for prior to the date on which the guidelines on lockdown revenue compensation for December were issued, it is still possible to apply for lockdown revenue compensation if the applicant undertakes to repay to COFAG the compensation for losses on a pro-rata basis for the December assessment period. At the latest, the repayment must be made in the course of the payment of the second instalment of the compensation for losses, with crediting being the preferred method.
  • Application is possible from 16 December 2020 to 20 January 2021 via FinanzOnline. The application via FinanzOnline can be also be submitted by a tax advisor/auditor or an accountant.
  • For applications submitted from 29 December 2020, payments will be made from mid-January 2021.

You can find further information via the following link: https://www.bmf.gv.at/public/informationen/informationen-coronavirus/infos-umsatzersatz.html

Authors: Daniela Stastny, Alexandra Velic