These are unprecedented times but as Edward Zander once said “it’s never as good as it feels, and it’s never as bad as it seems.” The legacy of such times can often be that you find the right employees, customers and suppliers for your business long term and end up with a more efficient and effective business model.

Many businesses have already been impacted significantly by COVID-19, but with stage one lock down coming into force over the next 24 hours many businesses will be hit much harder. These include Cafes, Restaurants, Retail and Gyms to name a few. In fact very few businesses will be immune to the impact of the current situation, over the weekend additional stimulus packages were announced by the Federal and State Governments, below we have summarised the support available for your business.


Financial Support for Small Business

Businesses with a turnover less than $50m will receive a tax-free cash payment of up to $100,000, with a minimum payment of $20,000 for an eligible business.

The payments will be made through the ATO and delivered as a credit on your ATO, BAS, PAYG statements from late April 2020.

The Government expects 700,000 small businesses will be eligible. This is interesting as there are over 2,000,000 small businesses operating across Australia. We expect further information to be provided as the new legislation is drafted.


Unsecured Business Loans

The Government is offering to guarantee unsecured loans through banks of up to $250,000 for up to three years with no re-payments or fees for the first six months.


Immediate Access to Superannuation (Sole Traders and Casual employees)

Eligible Australians will be able to access up to $10,000 from their superannuation this financial year (30 June 2020) and another $10,000 in the 2021 Financial year.

Eligible Australians include people on welfare benefits, sole traders and casual workers who have lost more than 20% of their income due to COVID-19.

There will be no tax or fees on the drawdowns. Without providing financial advice (we recommend you make an appointment with your individual financial advisor) we do note that many people would be drawing down on their superannuation which has fallen by up to 30% due to COVID-19. Therefore, if the financial markets are to stabilise and return to previous levels over the medium to longer you would miss out on this by taking advantage of this access.


Relaxing Insolvency Requirements

The Government is increasing the threshold from $2,000 to $20,000 that a supplier / creditor can issue a statutory demand against your business. As such creditors that are owed less than $20,000 cannot start proceedings that could push your business into insolvency.

One of the most surprising but welcomed changes announced was a relaxing of the insolvency rules (Corporations Act 2001) against the personal liability of directors.  As such the temporary changes provides flexibility for the first time ever for directors who are fighting to keep their business operating (directly as a result of COVID-19) and are technically on the brink of insolvent trading.


Home Loans

The majority of the major banks have confirmed that they will allow the suspension of monthly repayments (principal and interest) for a period of six months. While no penalty or additional interest is charged, the payments not being made will of course result in additional interest at your effective home loan rate (3% - 3.5% p.a).

For many small business owners this provides an opportunity minimise business drawings to cover required personal needs.

In these unprecedented times your businesses must remain active in planning your cashflows and strategy to survive this upcoming six-month period. Other tips and recommendations include:




Lease Expenses

  • Contact your landlord and discuss options to survive this period.
  • Your landlord will not benefit if you fall over, they will not fill the space in the current environment so there is a mutual benefit to working together
  • Consider requesting that you can access a portion of your security bond (Often up to 3 months rent)



  • Do not wait for a phone call from your suppliers, contact them and proactively discuss the working arrangement.
  • You need your suppliers but your suppliers also need you.



  • In times of crisis it is important to think outside the square. A great example is many restaurants and cafes turning to pre-packaged and take-way options. This is meeting the demand from customers who cannot source ingredients from supermarkets.



  • While these times can require significant changes to your labour model it must be done through a balanced and considered approach. The success of any business is dependent on the people within that business. This crisis will not last forever and the cost of trying to recruit and re-train new employees post this crisis will likely be significantly more expensive than the temporary savings in letting go valued staff members.
  • The Fair Work Act 2009 – Section 524 allows for the standing down of staff in certain circumstances. For many employers, the COVID-19 impact on your business will likely qualify. This allows you to greatly minimise your payroll expenses while allowing you to recommence normal operations post the crisis.
  • If staff need to be let go, to survive, ensure you work with a HR Professional to ensure the required steps are taken.

Our business is here to help yours, by taking a measured and strategic approach we can map out your cashflows across various scenarios and implement plans to ensure you survive this period of uncertainty.


Most importantly, keep safe and well.

Kind Regards

Tim Roberts