As the territory is ready for a resumption of business, with fingers crossed for a smooth transition and no further lockdowns, financial advisers have reported a last-minute rush of companies and individuals applying for the ACT Business Support Grant by October 7th.
RSM Australia Senior Adviser Young He said there has been a mix of companies rushing to claim, but exclusive distributors who had received the COVID disaster payment and were looking to switch made up the majority of last-minute applications .
“I think it’s human nature to wait until the last minute, but we were definitely busy last week,” he said.
She added that they are beginning to experience financial distress among commercial landlords who may require further assistance from the ACT government.
ALSO READ: ‘Passionate’ Vinnies CEO leaves after five years
Emergency measures were put in place to help commercial tenants and landlords affected by COVID-19. This included an interest credit of 50 percent of the total rent reduction for eligible renters, which is limited to the lowest of $ 10,000 or two-quarters of the rates.
Credits are based on rent reductions between August 1, 2021 and December 31, 2021, and landlords must reduce rent by at least four weeks during this period.
However, commercial landlords who apply for or receive assistance through the Small Business Hardship scheme are not entitled to a commercial interest credit, nor are owners whose primary income is generated indirectly, ie non-trading income, such as rent, shares and dividends.
“These landlords are not eligible for business support and the $ 10,000 is not enough to cover the rent reduction. Make this more complicated if their tenant has received state aid, the tenant must include any subsidy income in their declared income. If this has meant that the tenant’s income reduction is above the threshold, some landlords are not entitled to even credit interest, even if their tenant loses income, ”he said.
“We are starting to see more and more landlords in this position and in real difficulty.”
As the territory should start to emerge from lockdown on October 15, many companies will resume trading with some capacity, with the exception of retail stores that remain at the ‘click and collect’ level until the next level of easing on October 29.
READ MORE: Pandemic Budget Barr’s shot in the arm for Canberra
Last week’s budget for 2021-22 revealed some major ticketing items, including a $ 5 billion five-year infrastructure program, $ 500 million to increase the core health services in ACT’s healthcare system, and $ 90 million for the continued COVID response.
Prime Minister Andrew Barr said the government expected a consumer-led recovery.
“There is a lot of pent-up demand,” he observed.
Barr said the budget will rely on ACT’s lockdown being lifted as planned.
ALSO READ: ATO now issues warning messages to companies with tax debt
The Canberra Business Chamber welcomed the budget’s increased focus on supporting small businesses, but says more is still needed for this sector.
Canberra Business Chamber CEO Graham Catt said new funding to support tourism, events and the arts is badly needed and welcomed, but other companies in a number of sectors need additional financial assistance to survive as the economy slowly reopens for the rest of 2021.
“There are 30,000 private companies in ACT. The vast majority are small businesses, it is these businesses, not the public sector, that are now deliver over 60 percent of the territory’s jobs, ”Catt said.
“Many were hit hard by COVID-19 in 2020, then even harder again in 2021, and we have seen lost jobs and companies closed. Now is the time to do everything possible to protect and then create jobs in the private sector. Only in this way will we drive economic diversity, growth and local masters needed for a sustainable economy. ”