1. An increase to the base Small Business Cashflow Scheme (SBCS) and the ability to borrow a top-up if you did not borrow the full amount.
The SBCS base loan will be increased to $20,000 (from $10,000). This means the amount that can be borrowed will be $20,000, plus $1,800 per full-time equivalent employee (up to 50 employees). The loan repayment period remains 5 years (60 months).
Existing borrowers who already have a loan (and have not defaulted on this loan) will be able to apply for a top-up loan. They can borrow an additional $10,000 plus any amount they did not borrow in their initial loan. The top up loan can be drawn down as a lump-sum or as up to 4 smaller instalments over time before the end of the scheme on 31 December 2023.
A borrower who receives a top-up loan will have 2 separate loans, each with their own 5-year loan term and 2-year interest-free period.
Interest will apply at a rate of 3% per year on the remaining loan balance from the first day of the third year of the loan period.
2. Up to 3 COVID-19 Support Payments (CSP).
Each COVID Support Payment will be $4000 per business plus $400 per full-time employee, capped at 50 FTEs or $24,000. This is the same rate as the most recent Transition Payment. Businesses must show a 40 percent drop in 7 consecutive days within the 6 weeks prior to the shift to Phase 2 of the Omicron response on February 15, compared to 7 days after that date.
Applications for the first payment open on February 28, with payments starting from March 1. It will be available on a fortnightly basis for 6 weeks, with 3 payments in total.
3. An extension of IR’s ability to remit penalties and interest.
Any businesses struggling to pay tax because of the impacts of COVID should log on to myIR to see if they can delay starting payments to a later date, or if any part of the tax could be written off. IR can help with both GST and provisional tax due.
Also with the move to Phase 3 as annouced today, we thought this might be helpful too.