Corona crisis: containing the impact on your business
With the introduction of far-reaching measures, it becomes clear that the coronavirus has a significant impact and presents us with responsibilities and challenges as human beings. By extension, it is already clear that the impact on businesses is equally severe and will continue to be felt for some time.
In this post, we update you on some existing or just-introduced support measures and some legal tips that can help curb the impact of the corona crisis on your business:
- The deadline for filing corporate income tax, legal entities tax and "non-resident corporation" tax is extended from March 16, 2020 to April 30, 2020. This additional deadline applies only to returns with a filing deadline of March 16 through April 30, 2020;
- Deadlines for filing VAT returns are also extended as follows:
o Periodic returns:
Return for February 2020, deadline extended to April 6, 2020;
Declaration for March 2020, deadline extended to May 7, 2020;
Declaration for 1st quarter 2020 (or in case of quarterly declaration), deadline extended to May 7, 2020
o Intracommunity declarations:
Submission on February 2020, deadline extended to April 6, 2020;
Submission on March 2020, deadline extended to May 7, 2020;
Declaration on 1st quarter 2020 (or on quarterly return), deadline extended to May 7, 2020;
o The deadline for submitting the annual customer list has been extended to April 30, 2020;
- Furthermore, breathing space is also provided in the area of VAT and withholding tax payments through a general 2-month deferral of payment:
o For VAT:
Payment on monthly return - February 2020, deadline extended to May 20, 2020;
Payment on monthly return - March 2020, deadline extended to June 20, 2020;
Payment on monthly return - 1st quarter 2020, deadline extended to June 20, 2020;
o For withholding taxes:
Payment on monthly return - February 2020, deadline extended to May 13, 2020;
Payment on monthly return - March 2020, deadline extended to June 15, 2020;
Payment on monthly return - 1st quarter 2020, deadline extended to June 15, 2020;
- For the payment of both personal and corporate income tax, non-resident tax and legal entities tax, a additional period of 2 months are granted. This measure applies to settlements of these taxes for the 2019 assessment year that are established as of March 12, 2020.
- Enterprises may invoke the ability to support measures to be requested from the FPS Finance via https://financien.belgium.be/nl/ondernemingen/steunmaatregelen-betreffende-het-coronavirus-covid-19 and the form made available on this website. This may include additional payment facilities, exemption from late payment interest and/or remission of late payment penalties. Applications must be submitted by June 30, 2020.
- Self-employed people can obtain an extension of time to pay their provisional social security contributions of the first two quarters of 2020, without charging increases of 3% or 7%. Contributions for the first quarter of 2020 are due March 21, 2021. Contributions for the second quarter of 2020 must be paid by June 30, 2021. This measure also applies to the regularization of social contributions whose payment deadline was set at March 31, 2020. The self-employed person who wishes to benefit from this deferral of payment of any or all of these contributions must submit a written request through his social security fund before June 15, 2020. More information via: https://www.rsvz.be/nl/news/moeilijkheden-door-het-coronavirus.
- Self-employed persons in main occupation and assisting spouses who are forced to interrupt or cease their self-employed activity because of the coronavirus may, under certain conditions, invoke the bridging right. As a result, one retains acquired rights to care and disability benefits for up to 4 quarters without having to pay contributions and benefits can be obtained for up to 12 months (monthly without family burden: 1,291.69 euros, monthly with family burden: 1,614.10 euros).
- Businesses and the self-employed can have existing debts secured by PMV through a bridge loan (Participation Society Flanders). The existing guarantee scheme at PMV will be extended this year for financing up to 12 months. This will allow companies and the self-employed to have bridging loans guaranteed by PMV even for existing non-bank supplier debts (up to 12 months old) during this crisis period. More information via: www.pmvz.eu/corona-uitbreiding.
- The nuisance premium is provided for businesses and self-employed persons affected by the corona measures. These entrepreneurs affected by a complete closure will receive a one-time premium of 4,000.00 EUR and, if they still have to close their business after 21 days, compensation of 160.00 EUR per day. For businesses affected by weekend closures, there is a one-time premium of 2,000.00 EUR and if they still need to close their business after 21 days, they will receive compensation of 160.00 EUR per day. More information via: https://www.vlaio.be/nl/begeleiding-advies/moeilijkhedencoronavirus/specifieke-maatregelen-mbt-het-coronavirus/corona.
- The corona crisis may count as a case of force majeure. Force majeure is generally defined as an "unforeseeable and unavoidable event independent of the debtor's will that constitutes an insurmountable impediment to the performance of an obligation." Thus, both the corona crisis and its various consequences themselves and a government decision (such as the recent measures) thereon can qualify as force majeure. Force majeure can be grounds for any contracting party to terminate a contract or suspend contractual obligations (payment, delivery). The first step is to determine whether a contractual basis exists to invoke force majeure; this may be an actual contract or a contracting party's general terms and conditions. Often contracts and/or general terms and conditions contain a clause governing the terms and/or consequences of force majeure ("force majeure"). If there is no contractual basis, the existence of force majeure as a ground for discharge must be assessed based on the legal terms (see previous definition).
- It may be a good idea especially now in transactions a retention of title (on goods sold) or a lien (on an asset of the debtor) to negotiate to cover the financial risk. Both cases require an adequate contractual basis. If you would like more information in this regard, please feel free to contact Mr. Christophe Van Mechelen or Mr. Roeland Vanstaen (contact details below).
- Current circumstances demand that, in the short term to the extent possible, short cuts be made. The continuity of business activities and turnover must be ensured, for example, by diversifying or reorienting supply according to circumstances, mapping current orders/commitments, etc. Business processes can be streamlined as efficiently as possible to respond to changed and changing circumstances (procedures of ordering, payment, delivery, etc.). Fixed and variable cost items should once again be identified and rationalized where necessary and possible. Communicate timely and transparently with customers, suppliers and financial stakeholders about possible facilities or measures, such as a deferral of payment. If necessary, external financing or support should be considered.
- If necessary, the procedure of judicial reorganisation. When the continuity of the company is at risk, the court can grant protection in the form of a suspension of payments for an initial period of up to 6 months (renewable if necessary). During the suspension, either a reorganization plan and collective or individual agreement with the creditors or a transfer of all or part of the company to a third party under judicial authority is worked on. This procedure is a useful tool to facilitate a relaunch when there is no other way out.
At Bannister, Mr. Christophe Van Mechelen and Mr. Roeland Vanstaen are ready to advise and assist you in dealing with the business and legal consequences of the corona crisis. We will be happy to help you identify and, as far as possible, resolve the concerns and working points with which companies are (or will be) confronted. Meanwhile, we wish you first and foremost good health and much courage and optimism in fighting the corona crisis.
Antwerp, March 19, 2020
Christophe Van Mechelen (christophe.vanmechelen@bannister.be)
Partner
Bannister Lawyers
Roeland Vanstaen (roeland.vanstaen@bannister.be)
Attorney at law / Junior partner
Bannister Lawyers
