Some of Australia’s major banks have announced new support measures to assist businesses and individuals who have been impacted by Sydney’s extended covid-19 enforced lockdown and other snap lockdowns and travel restrictions across the country.

With fresh restrictions being tightened on what kind of shopping is deemed “essential” for the purposes of leaving home, more retailers are likely to join the ranks of hospitality and personal services businesses already shut or heavily affected by the lockdown. 

Prior to the announcement of the tightened restrictions, the Australian Banking Association (ABA) said its members, including the big four banks, would provide fresh support to customers struggling under the weight of lockdown restrictions. 

The ABA (Australian Banking Association) has said that these measures would be available to all small business and home loan customers significantly affected by current lockdowns or recovering from recent lockdowns, regardless of where they were located and what industry they were in. 

What financial support is being offed by the banks?

Small businesses who currently have debts under $3 million and a turnover of less than $5 million are eligible to apply for repayment deferrals of up to three months, with the deferred period added on to the end of the loan. 

The loan must not have been in arrears prior to the latest covid-19 impact unless the customer was already on an agreed payment program with their bank. 

Small businesses can also ask for refunds of their merchant terminal fees for up to three months and a waiving of fees on cash deposit and farm management deposit accounts for the same period. 

Both individual customers and businesses can also ask their bank for a repayment deferral on their home loan. 

Unlike blanket loan deferral offer from 2020, this year’s offer would be assessed on a month-by-month basis between the customer and the bank. 

“Customers can rest assured that if they need help, they will get it,” said the ABA’s chief executive Anna Bligh. 

“Your bank will help you find a way through, don’t tough it out on your own. 

“Banks also stand ready to support larger businesses and they will be assessed on a case-by-case basis.” 

How Can Customers Access The Bank Support?

The ABA represents 22 banks, including the big four, major regional and mid-sized banks, as well as foreign institutions with a banking licence in Australia. 

CBA will be proactively contacting eligible businesses early next week to offer them a loan deferral through an online application process. 

“The pandemic continues to impact businesses across Australia, with small businesses in particular facing cash flow challenges as a result of the lockdowns and restrictions on travel,” said The Commonwealth Bank’s chief executive, Matt Comyn.

“We recognise that some small businesses, like those in the tourism, hospitality and retail industries, are where the effects of lockdowns are being most acutely felt.” 

Westpac chief executive Peter King said his bank was gearing up in anticipation of increasing requests for support. 

“We are seeing the need for immediate support for small business owners who are experiencing challenges with reduced trade, cashflow and foot traffic as more people stay at home, particularly in areas with lockdown restrictions like Greater Sydney,” he noted. 

“We have scaled up our support to reflect the longer impact of COVID-19 and have a dedicated team of bankers available to help tailor this assistance to our customers’ personal circumstances” said Westpac chief executive Peter King.

NSW State Government Announces Support Package for Small Businesses Impacted By New Lockdown

The New South Wales State Government has announced a new support package to assist small businesses with the economic impact caused by the ongoing lockdown.

The package includes grants of between $5,000 and $10,000 for small businesses, payroll tax deferrals for all employers, and an extension of the Dine and Discover program to the end of August.

Clubs and hotels will also be given a reprieve with optional deferral of gaming machine taxes.

The funding process for the new support packages have been streamlined following a number of backlog issues associated with the northern beaches covid-19 grants which were announced to support business loss for the peninsula lockdown in December 2020.

The amount of funding that a business, which includes sole traders and not-for-profits, receives will depend on how much was lost due to the stay-at-home orders.

The NSW State Government has outlined these have been divided into two streams: small business and hospitality and tourism.

The grants will be available to small businesses, sole traders and not-for-profits that have:

  • A turnover of more than $75,000 but below the payroll tax threshold of $1,200,000
  • Fewer than 20 full-time employees
  • An accountant statement that confirms a loss in revenue for the time period compared to the same time in July 2019
  • For the tourism and hospitality sector, eligible businesses will need to have:
  • A turnover of more than $75,000 and an annual wages bill of below $10 million
  • An accountant statement that confirms a loss in revenue for the time period compared to the same time in July 2019

For businesses who are deemed eligible there will be a $10,000 grant available for businesses that have lost 70 percent of their revenue, a $7,000 grant for a 50 per cent loss, and $5,000 for a 30 per cent loss. Payroll tax deferrals will also be available to all businesses.

The hotels and clubs sector have also been given some tax relief, with the option to defer their June quarter gaming machine tax payments. These tax payments are usually due in July.

The team at C&D Restructure and Taxation Advisory are here to help. As part of the Vault Group we can offer the full suite of financial products and advice to help you navigate the business landscape. Schedule a meeting here via Calendly or give us a call on 07 36086800. 

Post Author: Craig Dangar

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