Finrepo » Finance News in Finland


Business cost support (second round, 2020) for Finnish companies

Business cost support in Finland

The second round of business cost support program will be open for application process in the last days of the year 2020 (update 10.12.2020: The State Treasury intends to start the processing of applications on 21 December 2020). An expert from the Finnish Entrepreneurs' Association (Suomen Yrittäjät) answers the most common questions about this program.

The application for the second round of cost support will begin at the end of December. As in the first round, the aid is intended for companies whose turnover has fallen as a result of the coronavirus pandemic. It is intended for, among other things, wage costs and rents. As in the first round, support is applied for from the State Treasury's online service.

In the second round, the business cost support terms will change, inter alia, so, that the minimum turnover threshold is removed. In addition, the subsidy period will be extended to five months.

In the previous business cost subsidy, the support period was two months (April and May 2020). In the second round, the support would apply to the period from 1 June to the end of October 2020. Thus, this is a continuation of the summer’s business cost subsidy round, the application period for which ended on 31 August 2020.

Frequently-asked questions related to the Business cost support for companies in Finland (second round), FAQ

Does the second round of cost subsidy apply to sole proprietors?

The support applies to all entrepreneurs and forms of enterprise.

Has the field of business been taken into account, especially now?

All industries are treated according to the same criteria.

If you already have got rejection in the previous round, then why even apply again?

It is not an obstacle to apply for the aid, even if you have not received it last time, because the reference period is different.

How are other subsidies already received taken into account here? Do they reduce the amount of aid?

The business cost support can be applied for even if the company has already received other direct subsidies intended to alleviate the consequences of the coronavirus pandemic. Thus, corona-related subsidies are not interconnected, but business cost support is taken into account in such a way that if enterprise has already received the aid for the expense extending to a new reference period, this same expense cannot be re-subsidized.

If you have received the cost support in the summer and the situation is still difficult, can you apply again?

This is not an obstacle to applying for support, as the reference period is different.

What if the company's turnover has fallen, but the industry has not? Is there any possibility to apply for support?

For solid reasons, a company in such an industry may also be eligible for support.

Can a private trader (self-employed) receive a cost subsidy?

The support applies to all entrepreneurs and forms of enterprise.

For what kind of expenses can the subsidy be used? Are there any restrictions?

Aid can only be granted for "inelastic costs" which the company cannot adjust, even if its activities and sales are reduced. These include, for example, rental costs, equipment and property rents, royalties, license fees and expenses for necessary temporary labor. Reimbursable expenses do not include, for example, material and supplies expenses, new investments and salary expenses that can be reduced.

I have heard that some of the recipients of cost support is obliged to pay the aid back? Why it is happened and is there a danger that this will happen with me?

Business cost support, like other subsidies, are recoverable (money can be recovered back). This may be the case, for example, if there are errors in the information provided by the applicant which would have resulted in the aid being granted in breach of the law.

Has the section "the activities of the sole proprietor must not be unprofitable from 2019 to receive support" removed from the application criteria for the second round of cost support? I have applied for self-employment support in the early summer of 2020. All the criteria in my application (including a drop in turnover of more than 50% from 1 March to 1 May 2020) were met, with the exception of last year's result, which was a loss of around EUR 8 000. My grant application was rejected. Whether I will receive support in the second round?

In this part, the terms and conditions of business cost support are not changing. According to the law, aid may not be granted to undertakings that were already in difficulty before 31 December 2019.

Is there a pre-established list of applicants who have already been dropped from the beneficiaries according to their main activity (as it was in the previous round)?

This is still the case according to the proposal, although again this item can be omitted from for compelling reasons (if the applicant can show a clear causal link to the pandemic).

Eligible for support business sectors are based to the government decree. If the company’s sector is not within the scope of support, the company can only be granted the support on particularly serious grounds.

We have now the first TYEL invoices for collection because our industry is unable to temporary layoff employees. Does it prevent access to the business cost subsidies?

No aid will be granted to a company which has been a "firm in difficulty" under the terms of the law. Cost support will also not be granted if:

  1. The company is not entered in the Prepayment Register.
  2. The company has failed to comply with the tax reporting obligation.
  3. The company has tax liability information (company's tax arrears) entered in the tax liability register.
  4. The company has unpaid taxes levied forcibly or the company has been declared bankrupt or a bankruptcy case is pending in court.

The full information and the source text can be found at Yrittajat website.

Published 04.12.2020, Updated 10.12.2020, FINREPO
  back to news