Surviving Challenging Times: A Guide on Government ‘s Pemulih 2021 Scheme & Grants For SMEs

Market Info

Surviving Challenging Times: A Guide On Government’s Pemulih 2021 Scheme & Grants For SMEs

Dato’ Seri Raymond Liew, Founder President and Jason Boey, Tax Director, from McMillan Woods, shared about the government’s PEMULIH 2021 scheme, grants for SMEs and business survival skills.

atuk Seri Raymond D shared key pointers on tax benefits, PEMULIH 2021, the availability of grants and other salient factors for the survival and health of businesses during these trying times. He highlighted that the government is trying to get businesses to go digital.

“The implementation of the SMEs and Micro-SMEs e-Commerce Campaign has an allocation of RM300 million. Through this campaign micro-entrepreneurs will receive business coaching, and on-boarding on e-commerce platform, while buyers will enjoy savings online. The objective of this initiative is to support entrepreneurs and businesses in generating income through online sales or the e-commerce platform,” he shares.

“There is a government tax deduction for COVID-19 screening for employees and business owners – a double-deduction for employers who fund the cost of COVID-19 screening employees for the whole of 2021,” he adds.

Dato’ Seri Raymond also noted that there is a special rental reduction given to property owners under the PEMULIH initiative, and that tax accountants will be able to work this out for property owners.

“The Special Prihatin Grant has been extended and is expected to benefit more than 1.2 million microSMEs. Micro-SMEs will receive a oneoff GKP 3.0 assistance of RM1,500, an increase from the previous RM1,000,” he explained.

PEMULIH 2021

Jason Boey explained the key highlights of PEMULIH 2021 which was announced on 28 June 2021, which consists; • RM150 billion package with the objective to help businesses and people who have been affected by the pandemic and EMCO. • Bantuan Prihatin Rakyat (BPR) announced in July 2021, with RM500 assistance for individuals who have lost their jobs and the needy. • A job-seekers allowance of RM300 is given to non-contributors of SOCSO allotted for new graduates and informal sectors. • Bantuan Khas COVID-19 (BKC) is available for several categories namely; o the hardcore poor with a household income of RM1,300 will be given a few payments of RM500 in August and November and RM300 in December 2021. o Singles will receive RM500, of which RM200 will be disbursed in August and RM300 in November.

o B40 segment with a household income of RM800 per month, will receive RM500 in August and RM300 in December; while singles will receive RM200 in August. o In the M40 segment, households will receive RM250, and singles will receive RM100. o A discount in electricity bills of between 5% to 40%, given based on certain criteria, and is expected to save approximately RM346 million in electricity bills over the next 3 months. o EPF has a new withdrawal scheme called iCitra, enabling a withdrawal of up to RM5,000, whereby RM1,000 per month will be disbursed up to 5 months, subject to members’ total EPF savings. This is expected to channel RM30 billion to people for their daily needs. o A 6-month automatic moratorium for all income categories are available, whereby approval will be given automatically by the bank once applications are made. o Targeted 3-month moratorium

for PTPTN borrowers from June to October 2021, for those who have lost their jobs or experienced a reduction in income. o Volunteers at COVID-19 vaccination centres will be given RM100 per day o From July 2021 onwards, there will be a special monthly allowance given to 14,000 healthcare frontliners serving during the pandemic, increased from RM200 to RM600. o There is a budget of RM1 billion to expand the immunisation programme, whereby the government will allow companies to resume full operation if employees have completed 2 doses of vaccination. Employers registered under HRDF can use up to 10% of remaining current levy for the cost of managing and purchasing the COVID-19 vaccines. o Economic sectors that have been badly hit such as hotels, convention centres and theme parks, shopping malls and tour operators will get a 10% discount on electricity bills from October to December 2021. o RM100 million allocated for SME digitalisation, which includes the reimbursement of up to RM5,000 for the purchase of digital equipment. o RM3,000 will be given to nursery operators, RM1,000 one-off payment to all registered school canteen operators, RM3,000 one-off payment to sports centre operators such as gyms, bowling alleys, futsal courts. o RM3,000 one-off payment to tour operators registered with MOTAC, when the third phase of the National Recovery plan commences. o Tax deduction for contributions made towards pandemic relief efforts. o Monthly tax instalments waived from April to December 2021 for tourism, cinema and spa industries. o Waiver of service tax for hotel operators up to December 2021. sales, HR payroll, procurement, e-commerce, remote working, ERP, and accounting & tax. • SMEs with a minimum annual sales of RM50,000 and at least 3 months in operations.

o PENJANA KERJAYA programme – there is a reduction in the salary eligibility limit from RM1,500 to RM1,200 to encourage more companies to engage local workers. o Wage Subsidy 4.0 offers RM600 per worker for 4 months.

FAQs by IRB

• For tax audits and investigation or letters received from IRB, if an extension of time is required, officers in charge must be approached and the extension will be considered on a case-to-case basis. • For the annual submission of Form C, IRB has given an extension from 31 October 2020 to 31 January 2021. • For individuals with business income, there is an extension up to 31 August 2021. • No extension for payments as they can be made online.

Availability of Grants

Market Development Grant • Introduced in 2002 to assist exporters and promote Malaysianmade products and serviced globally. • SMEs, professional services providers, trade and industry associations and co-operatives are eligible to receive up to RM300,000. • Applicable for the participation of physical or virtual events such as international trade fairs or conferences in Malaysia and overseas.

Selangor Information Technology & Digital Economy Corporation

• For Malaysian-owned companies registered in Selangor with a minimum paid up capital of RM100,000 and in operation for more than 3 years, or have successfully delivered digital solutions to at least 100 businesses.

SME Digitalisation Initiative

• Key areas of the adoption of digitalisation include digital marketing, electronic point of

Business Survival Tips for SMEs

Dato’ Seri Raymond explains that as SMEs continue to struggle and some are even closing down during these trying times since the COVID-19 pandemic began in March 2020, the key downfall is cash flow. Other pressing issues include poor sales, high wages and salary, escalating costs, services charges, bank loans and unclear guidelines on SOPs during movement control periods.

What is Needed to Prevent Cash Flow Leakage?

• Check financial status, look at current bank accounts, and talk to your accountants. • Study where cash is leaking and companies will be able to survive the pandemic. • Bring financial accounts up to date for submission to the government. • Approach your accountants for instalment payments. • Perishable items have expiry dates, hence, evaluate stocks. • Check debtors and receivables to avoid bad debts. • Extend payment deadlines to trade creditors to improve cash flow without jeopardising business relationships. • Seek out new suppliers with more competitive pricing. • Renegotiate rentals or move to smaller premises. • Reconsider staff numbers or consider a pay-cut to stay afloat. Perks or employee benefits may have to cease for the time being. • Seek legal advice early for binding contracts. • Digitalise your business and consider a 24x7 business model. Online stores are easy to set-up.