The Government has announced a boost to cashflow support for small businesses to aid in their recovery from the affects of Covid19.
The Small Business Cashflow Loan Scheme will provide assistance of up to $100,000 to firms employing 50 or fewer full time equivalent employees.
The scheme is in the way of a loan from the government and will provide $10,000 to every firm and $1800 per equivalent full time employee. Loans will be interest free if they are paid back within a year. The interest rate after this will be 3% for a maximum term of five years. A payment holiday is available for the first two years.
The eligibility criteria are the same as it was or the Wage Subsidy Scheme. Businesses will also have to declare that they are a viable business, they will use the money for core business operating costs and enter into a legally binding loan contract.
The loans can be used for core business operating costs (including, but not limited to, rent, insurance, utilities, supplier payments, or rates), and will be available to any ongoing business with the purpose of supporting it to remain a going concern.
Inland Revenue, who will be managing the scheme, will be take loan applications from 12th May and will pay out the funds soon after.
How to apply
Applications are open from 12 May to 12 June 2020 through myIR. Go to the I want to section, and select Apply for the small business loan.
myIR (external link) — Inland Revenue
If your businesses doesn’t have a myIR account, you will need to create one to apply.
Most applicants will receive their loan payment in full from Inland Revenue within five working days. Keep in mind you can only apply once and can’t change your application once submitted.
In addition to the tax changes, wage subsidy, commercial property measures and consultancy support already available – this will help substantially support small businesses and sole traders to get through this phase and into recovery.
Call the team to talk about your options.