Small businesses are slated to receive immediate support from the Federal Government as part of its bushfire relief package. This includes up to $500,000 in government funding.
That’s just part of the picture, though. There’s also concessional loans and tax relief for bushfire-affected businesses.
As a broker, it’s good business to stay on top of these developing initiatives. As well, keep the lines of communication open with your aggregator and lender BDMs to ensure SME clients have access to the full suite of support.
Moula also has hardship services available for clients impacted by the bushfires. Please contact your BDM to discuss the options available.
Government loans and grants
Loans of up to $500,000 with zero interest for two years have been earmarked for impacted businesses.
Interest will kick in at 50 per cent of the 10-year Commonwealth Government bond rate after the first two years. Right now, this interest rate would come in at around 0.6 per cent.
These loans will extend for up to 10 years, serving a couple of different purposes. Businesses could be eligible to tap into this funding for working capital, and to restore and replace damaged assets. Farmers, primary producers and non-profits will also have access to this funding.
This is building on disaster recovery grants put in place by state governments. Meanwhile, the private sector continues to get behind various bushfire recovery appeals of its own creation.
Through federal funding, grants of up to $50,000 will be made available to SMEs with sustained damage caused by the fires. This program is uncapped, seeming to be without strings attached. The grants are tax free.
Tax relief and a line of support
On that note of tax, some businesses will experience a wave of relief. Those in impacted postcodes now have until 28 May 2020 to lodge and pay their business activity statements and income tax returns.
With so many initiatives for businesses to now navigate, the Federal Government is working on creating a support line manned by financial counsellors specialising in small business. In the meantime, businesses can visit www.business.gov.au or call 13 28 46 for information and support.