This is the last in our series related to Financial Crisis Assistance and COVID-19.
The other 5 articles in this series are:
You can also refer to our other articles by clicking on the links above for your personal situation.
There are various issues now arising for Landlords and Tenants alike. With the announcement by the Prime Minister on Sunday to restrict social gatherings from midday today (23 March 2020) and to close as follows:
- Pubs, registered and licenced clubs (excluding bottle shops attached to these venues), hotels (excluding accommodation)
- Gyms and indoor sporting venues
- Cinemas, entertainment venues, casinos, and night clubs
- Restaurants and cafes will be restricted to takeaway and/or home delivery
- Religious gatherings, places of worship or funerals (in enclosed spaces and other than very small groups and where the 1 person per 4 square metre rule applies).
Australians should expect these measures to be in place for at least 6 months.
There is great uncertainty in relation to what tenants and landlords are able to do. It is imperative that both landlords and tenants work together during this time to achieve outcomes where possible.
For Tenants, review your business and make sure you are getting advice on all available resources, and we recommend the following:
a) Government Grants & Financial Assistance:
Obtain all financial and government grants possible, as set out in our earlier articles, is summarised as follows:
- Funds available for employers of a minimum of $20,000, and accessed via the BAS returns lodged;
- State Government Grants (in WA) if you are registered for payroll tax;
- Deferral of ATO obligations where necessary to assist with payment arrangements
b) Payroll Tax Concessions:
If you are subject to The Payroll Tax, contact your respective State Revenue Office and seek those exemptions and concessions.
c) Repayment Holidays:
Contact banks and utilise their 3 or 6 month repayment holidays that have been published.
d) Federal Government-Backed Loans:
Consider the loans for small business owners which has been guaranteed by the Federal Government; and
e) Review Business Performance:
Review your business and its metrics in regards to wages, sales and potential impacts of a 6-month lockdown on the rents.
For Landlords, get your cash flow in order in case of a tenants financial difficulties, and we recommend the following:
1: Bank Loan Repayment Holidays:
Most banks have now announced measures to provide between 3 month and 6 month repayment holidays on home loans. This can assist you in terms of the crisis, particularly if your tenant is having financial difficulty.
2: Review Rents and Financial Viability:
A review of your rents from your tenants may be considered and depending on what can be financially affordable, this may assist for some short term pain for longer-term gain.
This should be considered depending on the length of the lease, the type of lease and the business or the type of tenant.
If you have a commercial property, there will be different considerations than for residential properties.
We are expecting more information to be made available by various Government bodies, and also the Real Estate Institute of Australia and Real Estate Institute of WA. We will review this and then provide further advice once we have that information to hand.
Still have questions? We are here to help.
AAG is still working for you and we’ll keep you informed of all of the critical issues as they come to our attention.
We are here to support you with your finances and your financial welfare or any other concerns however small or large. Please email us at email@example.com, or via phone on 08 9227 6300.