01 Apr How to Access COVID-19 Support Available for Perth SMEs
As the COVID-19 pandemic continues to wreak havoc on the Australian economy, the federal and territory government are providing relief and stimulus packages to small business owners in Australia.
If you’re struggling to figure out how you can proactively manage your business during the coronavirus pandemic, this article will guide you on the steps you can take to keep your business operating and how to access the available help, such as government grants, stimulus package, and financial support from banks.
What to do first
- Understand your current financial situation by updating your business plan and the steps you need to take to keep your business running and your cash flow coming in.
- Review your finances and come up with a cash flow statement.
- Call your bank and inquire about loan deferral arrangements and waived fees and charges. You may also discuss with their hardship team if there are options available for your personal mortgages and loans.
If you realised you’ll be needing finance based on your current financial position, here are the support and grants available for small business owners:
Coronavirus SME Guarantee Scheme
Under the Scheme, the Government will provide a guarantee of 50 per cent to small and medium enterprise (SME) lenders for new unsecured loans to be used for working capital.
Eligibility: SMEs with a turnover of up to $50 million
- Maximum total size of loans of $250,000 per borrower.
- The loans will be up to 3 years, with an initial 6 month repayment hol
- The loans will be in the form of unsecured finance, meaning that bor
rowers will not have to provide an asset as security for the loan.
New JobKeeper Payment
Businesses impacted by the coronavirus (their turnover will be reduced by more than 30 per cent relative to a comparable period a year ago (of at least a month)) will be able to access a subsidy from the Government to continue paying their employees.
Affected employers will be able to claim a fortnightly payment of $1,500 per eligible employee from 30 March 2020, for a maximum period of six months. This includes eligible employees that have been stood down or re-hired. Businesses without employees that meet turnover tests, such as the self-employed, can also register their interest in applying for the JobKeeper Payment.
Early Access to Superannuation
The Government is also allowing sole traders who have seen their hours of work or income fall by 20 per cent or more as a result of the pandemic to access their superannuation. This is capped at $10,000 this financial year and a further $10,000 next financial year. The withdrawals will be tax free.
Eligibility: Individuals whose income has fallen by 20 per cent or more.
Additional payments for employers to retain staff
Not-for-profits and small businesses with a turnover under $50 million will receive a tax-free cash payment of from $20,000 up to $100,000 to help them retain staff and continue operating.
Eligibility: Small and medium business entities with aggregated annual turnover of less than $50 million and that employ workers are eligible.
Increase in the instant asset write-off threshold
The Government has lifted the threshold to $150,000 for assets that are either installed or ready for first use by 30 June 2020.
Eligibility: Businesses with aggregated annual turnover of less than $500 million (up from $50 million).
For a complete list of Australian Government small business stimulus/relief package, click here. The Western Australian Government has also announced measures to support small business which you can access in detail here.
Offers from Banks
All the banks are offering a similar menu of financial assistance and support for business customers, although details vary per institution. If you need to secure finance to keep your business operating, here are the offers:
- Businesses that have taken out term loans of up to $10m can put repayments on hold for up to six months.
- Waived merchant terminal fees, early redraw fees on business term deposit accounts, and establishment fees and excess interest on temporary excess products
- Loans are available through the small business loan guarantee scheme.
Note that these offers are what’s currently available and are subject to changes. You should always check with your bank before or consult your mortgage broker making any financial decisions.
Need more details or have further questions how to access the available relief and grants? Call 0408 081 082 today.
Credit Representative Number 486927 is authorised under Australian Credit Licence 389328.
This article provides general information only and has been prepared without taking into account your objectives, financial situation or needs. We recommend that you consider whether it is appropriate for your circumstances and your full financial situation will need to be reviewed prior to acceptance of any offer or product. It does not constitute legal, tax or financial advice and you should always seek professional advice in relation to your individual circumstances. Subject to lenders terms and conditions, fees and charges and eligibility criteria apply.