As a result of the extended lockdowns in New South Wales, the Federal and New South Wales governments have jointly released details of a new support package targeted at small to medium sized (SME) businesses as well as extended support for workers under the current COVID-19 Disaster Payment subsidy.
For businesses, the key cash subsidy support measures to note are as follows:
- A new Federal business support payment will be available of between $1,500 to $10k per week to entities with annual turnover between $75,000 and $50 million and who can demonstrate a 30% decline in turnover
- NSW COVID-19 Business Grant Expanded from $10k to $15k
- New Grant for Micro businesses with turnover of between $30k and $75k
- The key cash subsidy is the COVID-19 Commonwealth Disaster Payment which has been increased starting from week 4 of the lockdowns.
These measures together with other supporting measures including landlord and tenant rent relief and payroll tax concessions amongst other supporting measures are further explained below.
1. New Federal support business payment
For NSW businesses, a new cash lockdown support has been announced that incorporates features from the previous cashflow boost and JobKeeper subsidies.
The new small business support payment cover employers in business who have annual turnover of between $75,000 and $50m and who can demonstrate a 30% turnover decline as a result of the lockdown. The decline is to be measured against an equivalent period in FY19.
These businesses will be able to receive a cashflow boost style payment of between $1,500 and $10,000 per week based on their level of payroll. In this regard, it is understood that the amount of support will be based on 40% of NSW payroll payments.
Importantly, to receive payment the businesses in question are also required to maintain their full time, part time and long term casual staffing levels as of 13 July 2021.
For NSW businesses with no employees such as sole traders, the support payment is to be set at $1,000 per week.
In addition to the above, NSW businesses should also note the COVID-19 Business Grant based on a 30%, 50% and 70% turnover decline. Further details are explained below.
2. NSW COVID-19 Business Grant expanded
In an earlier Bentleys alert, we mentioned 3 tiers of grants of up to $10k for small businesses with turnover over $75k (and wages below $10m) to be available primarily operating in NSW. The grants are to be based on a percentage decline in turnover as a result of the lockdown restrictions from 26 June. These grants have now been increased up to $15k as set out in the table below.
|Decline in Turnover||Grant support as per earlier Announcement on 29 June 2021||New Grant support as per Announcement 13 July 2021
|70% decline in turnover||$10k grant||$15k grant
|50% decline in turnover||$7k grant||$10.5k grant
|30% decline in turnover||$5k grant||$7.5k grant
3. New Grants for Micro Businesses
Microbusinesses with a turnover of between $30,000 and $75,000 which wouldn’t otherwise satisfy the COVID-19 Business Grants mentioned above are now eligible for a separate grant where such businesses experience a decline in turnover of 30%. These businesses will be eligible for a $1,500 payment per fortnight during the lockdown period.
4. Worker Support – COVID-19 Commonwealth Disaster Payment
The current COVID-19 Commonwealth Disaster Payment is also to be increased from week four of a lockdown because of a Commonwealth Government declared hotspot regardless of state.
From week four of a lockdown because of a Commonwealth Government declared hotspot, the COVID-19 Disaster Payment will be $600 if a worker has lost 20 or more hours of work a week or $375 if a worker has lost between 8 and less than 20 hours of work a week.
Combined with earlier announcements, the payments can be summarised as follows:
|Lockdown Period||20 hours or more of work lost per week||Between 8 and less than 20 hours of work lost per week
|Week 1 to 3 of Lockdown||$500 per week||$325 per week
|From week 4 of Lockdown||$600 per week||$375 per week
In addition, it should also be noted that the Federal Government has removed the $10,000 cash limit to qualify for this subsidy as mentioned by us in an earlier article.
Other Support Measures Announced
In addition to the above, the NSW Government has also announced the following:
- Payroll tax – waivers of 25% of NSW payroll tax for businesses where payroll is between $1.2 million and $10 million and where the business has suffered a 30% turnover decline. Payroll tax deferrals and interest free repayment plans are also being offered.
- Landlords residential – Landlords that provide rent relief tenants in residential property and who do not pay land tax can qualify for a capped grant of up to $1,500.
- Landlords commercial, retail and residential – land tax relief equal to the value of rent reductions provided by commercial, retail and residential landlords to financially distressed tenants, up to 100 per cent of the 2021 land tax year liability.
- Protection for Residential Tenants – Introduction of legislative amendments to ensure a short-term eviction moratorium for rental arrears where a residential tenant suffers loss of income of 25% or more due to COVID-19 and meets a range of other criteria.
- Protection for Retail and Commercial Tenants – No recovery of security bonds, or lockouts or evictions of impacted retail and commercial tenants prior to mediation.
- Lending Support – The Australian Banking Association has announced banking support to assist eligible customers significantly impacted by the COVID-19 restrictions which includes up to a 3 month repayment deferral for small businesses, refunds of merchant terminal fees for up to 3 months and loan deferrals on a month-by-month basis for eligible homeowners and small business customers.
- Accommodation Sector Support – A support package for the accommodation sector worth $26 million.
- Support for the Performing Arts Sector – A $75 million support package for the performing arts sector to be administered by Create NSW.
- Gaming Tax Assessments – Deferral of gaming tax assessments for clubs until 21 December 2021 and hotels until 21 January 2021.
It can be difficult keeping track of the raft of new announcements, support that is currently on offer; satisfying the relevant conditions and making the relevant applications. Speak to your Bentleys advisor if you need any assistance in these challenging times.
Additional details can also be found in the links below:
Service.nsw.gov.au/covid-19-business-support-2021 (external website)
Media release – NSW-COVID-19-support-package
Media release – COVID-19-fighting-fund-to-protect-businesses-save-jobs-and-support-nsw-through
We are committed to supporting businesses during this challenging time. For further information or assistance, please contact your local Bentleys advisor.
Disclaimer: This information is general in nature and should not be relied on as advice. It does not take into account the objectives, financial situation or needs of any particular person. You need to consider your financial situation and needs and seek professional advice before making any decisions based on this information.