PFR 2.0 Financial Shield launched: firms can apply for financial support

From 15 January 2021, micro, small and medium-sized enterprises from the sectors which had to reduce or suspend their services due to COVID-19 may apply for support under the 2.0 Financial Shield. The estimated support budget is PLN 13 billion.

Due to the national quarantine and other restrictions introduced along with development of pandemic in the country, which led to imposing restrictions on business or suspension of services, the government and the Polish Development Fund (PFR) prepared a new financial aid program for business. The 2.0 Financial Shield will provide support in the form of redeemable subsidies for micro, small and medium-sized enterprises which carry out activities under 45 PKD codes (Polish Classification of Activities).

Companies can apply for the support from 15 January 2021.

PFR 2.0 Financial Shield – who can apply?

Financial aid under the 2.0 Financial Shield is available to micro, small and medium-sized enterprises from industries required to reduce or suspend services due to the COVID-19 pandemic. Aid in the form of subsidies redeemable up to 100% of a total value of PLN 13 billion is available to 45 industries, such as restaurants, hotels and other accommodation facilities, retail trade, cinemas, museums, cultural facilities and sports facilities.

The full list of PKD codes eligible form the 2.0 Financial Shield is available on the PFR website.

How to apply?

Companies can apply for support under the shield from 15 January to 28 February by submitting an application via electronic banking system prepared by PFR and 17 selected banks.

Before submitting the application, it is worth to submit first the JPK-V7M or JPK-V7K return form for December 2020 and then wait at least 7 days with submitting the application. It will allow time for Tax Office systems to properly process it and be immediately verified by PFR. For the system which verifies applications automatically checks whether a given entity has submitted tax return to the Tax Office, and if not, temporarily suspends the application and checks for tax return on a daily basis for a maximum period of 7 working days.

PFR 2.0 Financial Shield – eligibility criteria

There are several requirements for being eligible for the PFR aid program for micro, small and medium-sized enterprises. Businesses may be eligible if they meet, without limitation, the following requirements:

• run a business on 31 December 2019 and on the date of submitting the application for financial subsidy (on the date of submitting the application, the business cannot be in liquidation, bankruptcy or restructuring),
• operate under at least one eligible PKD code on three dates: 31 December 2019, 1 November 2020 and on the day of submitting the application,
• experienced at least a 30% drop in sales (the aggregate sales of a business in comparable periods are taken into account, not only from the activity under the eligible 45 PKD codes) in one of the following periods:

  – from 1 April 2020 to 31 December 2020 as compared to the period from 1 April 2019 to 31 December 2019,

• – from 1 October 2020 to 31 December 2020 as compared to the period from 1 October 2019 to 31 December 2019,

and small and medium-sized enterprises also in one of the two following periods:

• from 1 November 2020 to 31 December 2020 as compared to the period from 1 November 2019 to 31 December 2019,
• from 1 January 2021 to 31 March 2021 as compared to the period from 1 January 2019 to 31 March 2019.
• are not in arrears with payment of taxes and social security contributions as at 31 December 2019 or 31 December 2020, or as at the date of submitting the application for a subsidy, where such arrears do not comprise:
  
  – deferred or spread payment of taxes or social security contributions,

  – arrears with payment of taxes and social security contributions not exceeding three times the value of a fee charged by the designated operator within the meaning of the Postal Act for treating a letter as a registered mail,

  
  

  – submitting an application to ZUS for non-payment of social security contributions under the anti-crisis shields.

The full list of requirements for applying for a subsidy is set out in the program regulations, available in Polish.

PFR 2.0 Financial Shield– payment amounts

The total value of aid provided under the shield is estimated at PLN 13 billion, and the maximum payment for a micro-enterprise may be up to PLN 324,000 or PLN 3.5 million for SMEs.

A micro-enterprise i.e. a firm employing from 1 to 9 employees (in full time equivalents) and generating sales or showing a balance sheet total of less than EUR 2 million, may receive:

• PLN 18,000 per employed person when experienced a 30-60% drop in income,
• PLN 36,000 per employed person when experienced at least a 60% drop in income

but no more than PLN 324,000 in total, with the possibility of redemption of up to 100% of the subsidy depending on maintaining the employment in 2021.

Small and medium-sized enterprise, i.e. a firm employing from 1 to 249 employees (in full time equivalents) and generating sales of less than EUR 50 million or showing a balance sheet total of less than EUR 43 million (not being a micro-enterprise) and which experienced at least a 30% drop in turnover in the so-called qualifying period, may receive:

• a maximum subsidy of PLN 3.5 million, but no more than PLN 72,000 per employed person, and the subsidy amounts to 70% of gross loss (before tax) for a period from November 2020 to March 2021

Business which benefited from PFR 1.0 Financial Shield, may obtain a maximum support from both shields per employed person (as at 30 September, 2020), not exceeding:

• PLN 72,000 for micro-enterprises,
• PLN 144,000 for small and medium-sized enterprises.

When determining the number of “employed persons” for the purposes of calculating the amount of subsidy, persons employed under employment contracts (in full time equivalents) and persons employed otherwise (e.g. based on civil law contracts), for whom the employer pays social security contributions are taken into account.

The aid may only be used by beneficiaries to cover the costs related to the business activity, including without limitation, salaries, purchase of goods and materials, purchase of equipment and other fixed assets necessary for running a business. The program regulations prohibit to allocate the subsidy, among others, to payment of allowances on top of basic salary, sickness and downtime wages; transfer of funds to related entities, prepaid loans and financing of M&A transactions.

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