COVID-19 Updates

COVID-19 UPDATES

On 18 March 2020 the Cook Island Government announced a $61 million COVID-19 Economic Response Package. The purpose of the COVID-19 Economic Response Package was to support our people in response to, and to mitigate, the effects of COVID-19.

 

The COVID-19 Economic Response Package consists of the following support:

 

1. Income Support for Individuals

Full details of each measure and the application process can be located on the Ministry of Finance and Economic Management’s website. The relevant information is contained in Fact Sheet 1: Tax support for individuals and businesses

School closure support payment

$100 for each child for each fortnight that school holidays are extended. If you have queries contact the Ministry of Internal Affairs on 29370 or visit their website.

Electricity subsidy

Electricity subsidy of 100 per cent for households on Rarotonga and Aitutaki for three months starting from the 19 March 2020 meter reading. No application is required to access the subsidy. Your bill will be adjusted by the two electricity companies. Refer to TAU Short Term Relief Package for details.

One-off welfare payment

One-off welfare payment of $400 to old age pensioners, care givers and the infirm and destitute who are registered with the Ministry of Internal Affairs. If you have queries contact the Ministry of Internal Affairs on 29370 or visit their website.

Reduced CINSF contributions

Reduction in individual employee Cook Island Superannuation Fund (CINSF) contributions from 5 to 3 per cent for a 3-month period. You do not need to do anything to apply. Your employer will make the necessary changes to your pay.

Unemployment benefit

One month benefit at the minimum wage to be provided to all individuals who have become unemployed due to the impact of COVID-19. If you have queries contact the Ministry of Internal Affairs on 29370 or visit their website.

Employment services

The Ministry of Internal Affairs will assist to find you employment as soon as possible through offering employment services. If you have queries contact the Ministry of Internal Affairs on 29370 or visit their website.

2. Financial Support for businesses

Full details of each measure and the application process can be located on the Ministry of Finance and Economic Management’s website. The relevant information is contained in Fact Sheet 2: Financial Support for businesses.

Wage Subsidy

The wage subsidy measure is designed to ensure that employers keep their staff on the payroll and to keep business going as best as possible under the current circumstances.

All applications must be submitted on the CINSF website via the Employer's account. The process of how to apply is set out in Fact Sheet 2: Financial Support for businesses or you can visit the Ministry of Internal Affairs website. Once submitted, applications are screened by Revenue Management. If you have queries contact CINSF on 25515 or Recenue Management Division on 29365. 

Training subsidy to upskill workers

The purpose of this measure is to encourage businesses to take advantage of what may be a slow time to upskill their workers and improve their productivity so that businesses are better able to respond when the crisis is over, and the economy begins to recover. More information can be found on the Ministry of Internal Affairs website.

This measure is being administered by the Cook Island National Superannuation Fund. If you have queries contact them on 25515 or visit their website.

Cash Grants

The one-off cash grant provides an immediate cash injection to all registered businesses that are affected by COVID-19. It will assist to keep them operating during the crisis and improve their chances of getting back on their feet afterwards.

Fact Sheet 2: Financial support for businesses (see page three) contains full details of the cash grant.

About the cash grants

The value of the grants are as follows:

  • $3,000 for sole traders
  • $5,000 for those businesses with a turnover less than $300,000
  • $10,000 for those businesses with a turnover between $300,000 and $5 million
  • $15,000 for those registered businesses with a turnover greater than $5 million

The payment will be made as a one-off payment to each business that qualifies.The cash grant scheme is administered by the Revenue Management Division. Payments to eligiblebusinesses will be made as soon as processed, after 1 April 2020.

Who is eligible

  • Your business must have been operating in the Cook Islands prior to 1March2020.
  • Your business must be registered with Revenue Management and CINSF.
  • If you are not currently registered you must register by 30 April 2020 and provide confirmation of business operations prior to 1 March 2020.
  • Your business activity must have experienced a minimum 30% decline in revenue over the period of a month when compared with the same month last year, and that decline is related to COVID19.
  • To verify this you must lodge your VAT tax return for the period ended 31 March 2020.
  • If you are not VAT registered or have been in business for less than 3 months you will need to provide documentation (e.g. bank statements, market registration) to enable your loss of income to be assessed.
  • Businesses must complete a declaration form to allow assessment of business/tax information for this purpose.

How to apply

  • The employer must login to their CINSF account from 1 April 2020 and apply for the cash grant online, providing all necessary information as instructed.
  • Eligibility will be assessed by Revenue Management. Once verified, payment will be made directly to the employer’s account.

Reduced employer Cook Island National Superannuation Fund contributions

Reductions in the mandatory employer Cook Island National Superannuation Fund contributions will temporarily provide additional financial support for businesses during the COVID-19 crisis. This is a complementary measure to the same reduction being applied for employee CINSF contributions.

Employers will be responsible for making the necessary adjustments through their Cook Island National Superannuation Fund accounts for their contribution and that of their employee(s).

Self-isolation payment

The COVID-19 self-isolation payment is aimed at supporting those businesses covering absences due to self-isolation. In prevention of a pandemic outbreak, it is important to encourage workers to respect self-isolation instructions without worrying about loss of income. If you have queries contact the Ministry of Internal Affairs on 29370 or visit their website.

Electricity subsidy

The subsidy, which applies to all business electricity customers, will commence from the meter reading following 19 March 2020. Monthly electricity bills will be 60 per cent subsidised for business customers in Rarotonga by Te Aponga Uira and 100 per cent subsidised in Aitutaki by Te Mana Uira O Araura. No application is required to access the subsidy. Customer bills will be adjusted by the two electricity companies. Refer to TAU Short Term Relief Package for more information.

3. Tax support for individuals and businesses

Full details of each measure and the application process can be located on the Ministry of Finance and Economic Management’s website. The relevant information is contained in Fact Sheet 3: Tax support for individuals and businesses.

An income tax credit of up to $2,000 for short-term accommodation providers with up to 10 beds

Short-term accommodation providers are an important part of the Cook Islands tourism industry. To assist these people, an income tax credit of $2,000 is available for short-term accommodation providers with up to 10 beds.

The maximum income tax credit that any one short-term accommodation provider can receive is $2,000.

How to qualify

  1. Your business must be registered with Revenue Management and operating in the Cook Islands.
  2. Unregistered short-term accommodation providers must register with Revenue Management before 30 April 2020. Register now if you are not already registered.
  3. Your short-term accommodation facilities can have up to a maximum of 10 beds.

How to apply

You will apply for this tax credit by signing a declaration confirming that you meet the qualifying criteria. This declaration will form part of your 2020 income tax return.

If you have queries email them to Revenue Management at tax.info@cookislands.gov.ck and enter “Income tax credit for small short-term accommodation providers” in the subject line. Note that telephone support on +682 29365 will be strictly limited over the next few months.

Provisional tax estimation or re-estimation

Some taxpayers provided and paid their provisional tax estimates to Revenue Management before the onset of the COVID-19 pandemic. For this reason your earnings have may have been overestimated. If your circumstances have changed due to COVID-19, you may be able to make an estimate or re-estimate of provisional tax.

We can also arrange early refunds if provisional tax has been overpaid. Refer to the Provisional Tax Guidelines.

How to apply

  1. Complete the Provisional Tax Application Form
  2. Email the completed application form to Revenue Management at tax.info@cookislands.gov.ck with the subject line “Estimation / re-estimation of provisional tax”.

Queries can be sent to Revenue Management at tax.info@cookislands.gov.ck. Note that telephone support on +682 29365 will be strictly limited over the next few months.

Increase in the provisional tax threshold from $2,000 to $5,000

To provide additional relief the provisional tax threshold has increased. This applies to provisional tax for the 2020 and subsequent tax years.

If you have previously been assessed and your provisional tax payable for the 2020 tax year is between $2,000 and $5,000 this will automatically be reassessed by Revenue Management. If you have paid provisional tax relating to the 2020 tax year but are no longer liable for provisional tax, refunds of the amount paid can be arranged.

How to apply

If you think you might be entitled to a provisional tax refund relating to your 2020 tax year please email Revenue Management at tax.info@cookislands.gov.ck and explain your situation so we can look into it. Please insert in the subject line “Provisional tax refund”.

Queries can be emailed to Revenue Management at tax.info@cookislands.gov.ck. Note that telephone support on +682 29365 will be strictly limited over the next few months.

Tax payment relief

About tax payment relief

  • If you are having difficulty paying outstanding tax Revenue Management can help set up a temporary payment installment arrangement or adjustment of a current payment installment arrangement.
  • In some circumstances a taxpayer’s tax debt is written off due to serious hardship. Tax losses carried forward will be reduced in proportion to any amount written off.

How to arrange or alter an existing payment installment arrangement

How to apply for a serious hardship write-off

4. Other ways we can help

Extension of tax return due date

Filing extensions available only for income tax returns. VAT and PAYE returns must be filed as per normal by the due date. Although, penalties applied to any late VAT and PAYE return may be remitted upon request and approval from our office. Refer to the Standard Practice Statements below for more details.

Extending timeframe for filing tax returns

Remission of Additional Tax

All applications/requests can be directed to tax.info@cookislands.gov.ck.

Updated 31.03.20 PD