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  • Temporary subsidy program

    March and April 2021

Article:

Temporary subsidy program: March and April 2021

29 March 2021

Svetlana Majerovitš , Tax & Legal Services Director |
Michelle Shestakova , Tax & Legal Services Legal Specialist |
Anna-Anita Danilova , Tax & Legal Services Assistant Project Manager |

Due to the strict restrictions on the spread of the coronavirus, many companies have experienced economic difficulties which could lead to the employment losses. In order to preserve employment, the government approved the extended salary grant on the proposal of the Unemployment Insurance Fund’s supervisory board.

 

Salary grant is paid to a company whose core business is significantly affected by the restrictions.

The company can apply for extended salary grant if:

  • their turnover or revenue has decreased by at least 50 percent in March 2021 compared to the average monthly turnover in the period from December 2019 to February 2020.
  • no compulsory winding-up, liquidation or bankruptcy proceedings have been initiated and at the time of the application there are no tax debts or they have been deferred.

The grant is paid to the following employees:

  • who have not been provided with work in the agreed volume or whose salary has been reduced.
  • who have an employment relationship in force at the time of the application and whose date of commencement of employment with the employer applying for the extended salary grant is 1 October 2020 at the latest.

The Estonian Unemployment Insurance Fund reimburses the employer 60 percent of the employee’s previous average salary, but not more than EUR 1,000 per month (gross).

The employer itself is obligated to pay a gross salary of at least EUR 200 to the employee, who receives the extended salary grant, from their own resources. Companies are not allowed to lay off the employees receiving support until 31 May.

The applications for extended salary grant will be accepted via e-töötukassa from 1 April until 3 May 2021.

 

If you have any further questions regarding this topic, please contact us - we will be happy to help you!