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UPDATED: NSW COVID-19 Support Package eligibility

UPDATED: NSW COVID-19 Support Package eligibility

Simon Alford

The NSW government has released further details regarding the 2021 COVID-19 support package it announced last week, designed to support businesses through the recent June/July 2021 lockdown. 
 
We understand that some of the finer details are yet to be clarified, however please find below a summary of the new information released.

As previously announced the support package comes into two different streams:

  1. Small Business COVID-19 Support Grant: for small business and not-for-profit entities
  2. Hospitality and Tourism COVID-19 Support Grant: for the hospitality and tourism sector 

Depending on which stream your business falls under, different eligible criteria will need to be met. 

It is important to note that only one stream is available per entity, which means that you cannot claim both. 
 
Turnover test criteria

The turnover test is the first criteria that needs to be met regardless of which stream you fall under. 

Businesses needs to have had a minimum 30% decline in turnover over at least a two-week period following the lockdown.
 
The grant amount is dependent on the decline in turnover measured by percentage as follows:

  • 70% or more decline: $10,000 
  • 50% or more decline: $7,000 
  • 30% or more decline: $5,000  

The calculation is based on comparing the turnover for a minimum two-week period after the lockdown commenced, to a two-week period in June/July 2019.
 
Details surrounding providing proof of decline in turnover have not yet been released.

The government has indicated that businesses that were not operating in June/July 2019 may still be eligible for the grant, however no further details regarding eligibility have been provided.  If you fall under this category you are encouraged to contact Service NSW to discuss your eligibility for the grants.

Once the decline in turnover test has been met, businesses will need to meet specific criteria dependant on their stream as below.

Small business COVID-19 support grant

Eligibility criteria: 

  • Have fewer than 20 full time equivalent employees (including non-employing businesses)
  • Have an ABN registered in NSW or can demonstrate they are physically located and primarily operating in NSW. Only one grant is available for a single ABN
  • Have total Australian annual wages below the 2020-2021 NSW payroll tax threshold of $1,200,000 as at 1 July 2020
  • Have not applied for, or received, the Hospitality and Tourism COVID-19 Support Grant
  • Have an annual turnover of more than $75,000 as at 1 June 2021, and
  • Have business costs for which there is no other government support available.

Hospitality and Tourism COVID-19 support grant

Eligibility criteria: 

  • Have an ANZSIC code that is classified as a tourism or hospitality business
  • Have an ABN registered in NSW or can demonstrate they are physically located and primarily operating in NSW. Only one grant is available for a single ABN
  • Have total annual Australian wages below $10 million as at 1 July 2020
  • Have not applied, or received, a 2021 Small Business COVID-19 Support Grant
  • Have an annual turnover of more than $75,000 as at 1 June 2021, and
  • Have business costs for which there is no other government support available.

Sole traders and businesses in regional NSW that are affected by the lockdown are eligible for the grants should they meet all relevant eligibility criteria of either stream.

Grant funds can be used for business expenses for which no other government support is available, for example:

  • Meeting business costs, including utilities, wages and rent
  • Financial, legal or other advice to support business continuity planning
  • Marketing and communications activities to develop the business
  • The cost of perishable goods that can no longer be used, or
  • Other activities to support the operation of the business.

 Applications for the grants are to be made through Service NSW with the application process due to open later in July 2021.
 
While some of the finer details are yet to be released, such as proof of decline in turnover and eligibility for businesses that were not trading in June/July 2019 – businesses can start assessing eligibility for the support package now.

We expect that the ATO will release guidance on how the grants will be treated for income tax purposes.  Some state grants have been treated as non-assessable, non-exempt income whilst others are assessable income.

Contact your Moore Australia advisor to find out more and discuss your eligibility.