THE NETHERLANDS : TEMPORARY BRIDGING SCHEME FOR INDEPENDENT ENTREPRENEURS (TORZO)

24/03/2020

The temporary bridging scheme for independent enterpreneurs can be applied by the independent enterpreneur, including self-employed persons, who are in problem due to the corona crisis.

There are 2 types of support possible:

1. Maximum of 3 months income support up to the social minimum.
2. In addition, a loan for working capital can be requested.

The scheme applies to self-employed persons and amounts to a maximum of EUR 1,500.31 net per month. The scheme is based on the existing Bbz (Decree on assistance for the self-employed), but is treated and provided more quickly. This provision has temporarily flexible conditions because of the special situation in which the Netherlands finds itself: for example, income support for maintenance does not have to be paid back later. In addition, a loan for working capital can be requested.

The Torzo will be valid for 3 months, until 1 June 2020, and will be carried out by the municipality where the entrepreneur lives. The enterpreneur can apply for the scheme as of  March 1, 2020. The Ministry of Social Affairs and Employment will further elaborate the scheme with, among others, the Association of Dutch Municipalities.

How is the temporary bridging scheme for independent entrepreneurs look like?

The enterpreneur can request support in the form of an additional payment for living expenses and / or for working capital. The scheme is based on the existing Decree on assistance for the self-employed (Bbz) and is implemented by municipalities. The enterpreneur must make its application to the residential municipality, not the municipality where the company is located.

This temporary arrangement includes the following:

• The viability test is not applied in order to process the application quickly.
• Income support for livelihoods will be provided for a maximum period of 3 months within 4 weeks.
• In addition, advances can be used.
• The level of income support depends on the income and the household situation, up to 1,503.31 euros per month.
• This accelerated procedure also applies to applications for a working capital loan of up to 10,157 euros.
• The income support for living expenses does not have to be paid back later.
• There is no asset or partner test in this temporary scheme.
• When a working capital loan is granted, the option to defer the repayment obligation is recognized.
• When a working capital loan is granted, a lower interest rate applies than with normal Bbz.

To whom does this new scheme apply?

The extra temporary support for established entrepreneurs is made for self-employed entrepreneurs who are in problem due to the corona crisis.

The following requirements apply:

• Self-employed persons, from 18 years of age up to retirement age.
• Resident and lawfully resident in the Netherlands.
• Dutch or equivalent.
• The company or independent profession is carried out in the Netherlands.
• Meets legal requirements for running your own business, including registered in the Trade Register of KVK.
• Started the company before 1 January 2020 and meets the hour criterion, that is to say at least 1,225 hours per year working in his own company or self-employed profession.
• Resident in the municipality, where additional income support is requested.

 

Regulation not yet in force

The scheme is not yet in force, so municipalities are not yet able to dispose of it. However, they can process applications. Municipalities that want to support independent enterpreneurs without prejudice to the new scheme can do this by granting an advance.

 

How do you apply?

The existing Bbz application form is used for the application. The enterpreneur has to submit the application to the residential municipality, together with an extract from the Trade Register of the Chamber of Commerce, copies of the identification, bank statements and existing orders and letters. Municipalities try to arrange this digitally where possible.

The Ministry of Social Affairs and Employment (SZW) is now working on the scheme (AMvB) and expects to be able to provide more details by 25 March 2020. The official regulation itself is not yet there, because of the procedures involved.