How you can support local business and how Government is supporting them

With everything going on, this week I would like to provide a rundown of some of the financial assistance that is available to both individuals and businesses.

However, before I go through the financial assistance, I want to mention that as hard as the next few weeks and months will be, it will pass. The world may be different and sadly there will be tragedy along the way, but we can get through it.

It is important we all look after ourselves and be kind to each other. Eat well, exercise and keep in touch with family and friends, especially if you know they are isolating at home by themselves. If you need help, whether it be for emotional or financial support, reach out. Together we can do this.

As much as we need to look after ourselves and support each other, we also need to support our local businesses. Estimates are that around 350,000 of them across Australia are likely to close because of this crisis. This will be 350,000 families that face financial ruin if we don’t go out of our way to support them now.

How you can help local businesses

The one thing businesses need is money. Likes on Facebook won’t save them. With this in mind, here are three practical ways you can help your local businesses, especially those that have had to close:

  • If you have a weekly membership or pay regular fees, whether it be at a gym or even a childcare centre, let them know they can keep charging you even though they have had to close. Encourage others to do the same.
  • For business that you would normally use, get a gift card from them or pay in advance for a purchase that you will be making when they reopen.
  • For businesses that have changed the way they sell their products (ie they moved to online or are only doing takeaways), go out of your way to use them, even if it is inconvenient.
Business grants that can be applied for
  1. NSW Government – Bushfire Support – $10,000 grant for small businesses in local government areas impacted by the bushfires. This includes Bungendore. You will need to demonstrate that your business revenue was 40% less over a 3-month period compared to the previous year.

2. NSW Government – Bushfire recovery grant – Up to $50,000 to assist with costs associated with the clean-up and reinstatement of a small business or non-profit organisation’s operations. The costs could include things like paying tradespeople, removing damaged materials, hiring equipment and purchasing stock. You cannot use the funds for things that are covered by your insurance.

3. Commonwealth Government – Support for apprentices and trainees – Employers can be reimbursed up to a maximum of $21,000 per apprentice. This is based on 50 per cent of their wage for the 9 months from 1 January to 30 September 2020. The subsidy will be available to small businesses employing fewer than 20 full-time employees who retain an apprentice or trainee. The apprentice must have been in training with a small business as at 1 March 2020. For details on how to apply for the subsidy contact an Australian Apprenticeship Support Network provider.

Additional payments/tax incentives for businesses that you do not need to apply for

4.     NSW Government – Payroll tax relief – All companies that pay total wages of up to $10 million will have their payroll tax liabilities reduced by 25% for the 2019-20 financial year. In addition, the tax free threshold will increase from $900,000 to $1 million from 1 July 2020.

5.     Commonwealth Government – Boosting cash flow for employers – up to $100,000 for small and medium-sized businesses, and not for-profits that employ people. There is a minimum payment of $20,000. Employers will receive a payment equal to 100 per cent of the income tax withheld up to $100,000. The minimum payment is $20,000. The payment will be received in two parts, the first coming after the BAS is lodged in April and the second when the BAS is lodged in October. You do not need to apply for this as the ATO will calculate how much businesses are eligible for.

6.     Commonwealth Government – Increasing the instant asset write-off – The amount businesses can claim on individual items is increasing from $30,000 to $150,000. Further, if the item is more than $150,000, the business will be able to claim 50% of its value in the first year. Both of these will be particularly helpful for businesses that intend to purchase high value items such as cars, trucks or farm machinery.

Assistance for business needing to borrow money

7.     Commonwealth Government – SME loan guarantee scheme – the Government will provide a guarantee of 50 per cent to SME lenders for new unsecured loans up to $250,000 that can be used for working capital. The loans will be up to three years, with an initial six month repayment holiday. The loans will be in the form of unsecured finance, meaning that borrowers will not have to provide an asset as security for the loan.

Assistance to retirees

8.     Commonwealth Government – Reducing super minimum drawdown amounts – For those with super that is in pension phase, the minimum drawdown percentages have been reduced by 50% for the 2019-20 and 2020-21 financial years. This will reduce the need for people to sell down their investments at a time when the value of their super has decreased.

9.     Commonwealth Government – Reduced deeming rates – From 1 May 2020, the upper deeming rate will be reduced to 2.25% and the lower rate will be 0.25%. Most people that receive a part aged pension should receive a slightly higher amount.

Assistance to individuals

10. Commonwealth Government – Increased and accelerated income support – Waiting periods and means testing have been waived for those recently unemployed, or those that run their own business but are unable to continue operating. There will also be an additional $550 supplement added to all income support payments. While claims can be done online, note that they are experiencing significant demand and processing may not be immediate.

11. Commonwealth Government – Temporary early release of super – If needed, people can access $10,000 of their super now and a further $10,000 after 1 July 2020. To qualify you must be unemployed or made redundant after 1 January 2020; a sole trader that has had a drop in turnover of at least 20%; or eligible to receive jobseeker, parenting payments or the farm household allowance. This should be accessed only as a last resort, and you should discuss with a financial counsellor before you do it.

Non-Government support

12. Banks – Loan deferral – Many of the banks and credit unions have agreed to defer mortgage and small business loan repayments for up to six months. Note that this is just deferring the loan and any interest accrued in this time will be added to the loan. While it sounds good, you should be aware you will end up paying interest on this interest. Contact your bank or credit union if you need to take advantage of this.

13. Utility providers – Payment plans – Most energy providers and phone/internet companies have indicated that they may waive late fees and/or enter into payment plans with you if your personal financial situation changes. If you are in financial difficulty you should contact your utility provider.

14. Lifeline and BeyondBlue – Mental Health is one of the biggest issues when we are going though crisis like we are now. Don’t be afraid to reach out and talk to professionals. – Phone: 131114 – Phone: 1300 22 4636

If you would like to discuss your business or personal finances or if you just need to talk about any concerns you have with the what we are currently going through, please book a chat via the button below or contact us on 0417034252 or email at

About the Author
Phil Harvey is an independent financial adviser. In 2017 Phil set up his company Construct Wealth to help clients best manage their finances so they focus on what is important to them. He is a founding member of the Profession of Independent Financial Advisers and a tax financial adviser, registered with the Tax Practitioners Board.

General Advice Warning
This advice contains general information. It may not be suitable to you because it does not consider your personal circumstances. Phil Harvey and Construct Wealth are authorised representatives of Independent Financial Advisers Australia (AFSL 464629)