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Sole traders: recapping the NSW Govt Covid-19 response

If you’re based in New South Wales, then you may be eligible for support payments related to the June/July 2021 Covid-19 outbreak.

So far the Australian government has made the following relief payments available:
 

For sole traders and small businesses

The big announcement for sole traders and SMEs was the ‘2021 COVID-19 Support Package’, which includes:

These payments will come directly from the NSW Government.
 

For individuals

‘Covid Disaster Payments’ have been made available to individuals who have been impacted by the July 2021 lockdown.

These payments can be up to $750 a week depending on the period date range and your location.

The Australian government is responsible for these payments and more Information on how to apply for the disaster payments can be found here.

Don’t want to read the full article?

No worries - skip to our TL;DR at the bottom.
 

Payments available to sole traders and small businesses


COVID-19 Business Support Grant

The ‘COVID-19 Business Support Grant’ is available for NSW businesses and sole traders who had a turnover of more than $75,000 per annum for the year ending 30 June 2020.

Three different grant amounts will be available depending on the decline in turnover experienced during the restrictions:

  • $7,500 for a decline of 30% or more,
  • $10,500 for a decline of 50% or more,
  • $15,000 for a decline of 70% or more.

From 19 July 2021, eligible NSW businesses, sole traders and not-for-profit organisations are able to apply.
 

Small Businesses Fees and Charges Rebate

If you are a sole trader or the owner of a small business you may be eligible for the ‘Small Business Fees and Charges Rebate’ of $1,500.

This rebate is to offset the costs of eligible NSW and local government fees and charges due and paid from 1 March 2021 to 30 June 2022.

Eligible businesses only need to apply for the rebate once, but can submit multiple claims until the full value of $1,500 is reached.

You will need to supply supporting documents, such as an invoice or receipt of payment of the eligible government fees or charges, when applying for the rebate and each time you make a claim.

View the full list of eligible fees and charges here.

 

COVID-19 Micro Business Grant

If you are a sole trader or small business with annual turnover between $30,000 and $75,000, then you could be eligible for the Micro Business Grant. The Micro Business Grant is a fortnightly payment of $1,500 to cover business expenses for the duration of the Greater Sydney lockdown.More information regarding the Grant, including eligibility details and application process can be found here.

Note: you cannot get both the Micro Business Grant and the COVID-19 Disaster Payment.
 

What payments are available to individuals now

The ‘COVID-19 Disaster Payment’ is a payment from the Federal government to individuals affected by a declared lockdown. This is a lump sum payment to help when COVID-19 restrictions last for more than 7 days. Every 7 days is called an ‘event’ and payments can be claimed once for every event. 

There are different dates for the ‘events’ depending on whether you are affected as part of Greater Sydney or in specific Local Government Areas.

Depending on where you live and/or work, you may be able to make a claim for lost work occurring from the 1st of July onwards.

The dates of each event are listed below:

Parts of Sydney:

Greater Sydney:

All other areas of NSW:

These dates will be adjusted as further lockdowns are announced. Most up to date dates can be found here.

Note: you cannot get both COVID-19 Disaster Payment if you are receiving any other state pandemic payment or a state small business payment for the same period.

How much can I get

There are three different payment amounts for different periods covered by the lockdown.

For the first and second events (1-7 July and 8-14 July in parts of Sydney):

  • If you have lost less than 20 hours work - you’ll get $325 per event
  • If you have lost more than 20 hours work - you’ll get $500 per event

You must have liquid assets of less than $10,000 if you’re claiming for the first event (1 to 7 July 2021).  There is no liquid assets test to be eligible for the payments from the second event (8 July 2021) onwards.

From the third to sixth events (15 July to 4 August 2021 in parts of Sydney):

  • If you have lost between 8 to 20 hours work - you’ll get $375 per event
  • If you have lost more than 20 hours work - you’ll get $600 per event

For the additional 4 weeks of lockdown announced (05 August to 28 August):, 

  • If you have lost between 8 to 20 hours work - you’ll get $450 per event
  • If you have lost more than 20 hours work - you’ll get $750 per event

The disaster payment is a non-taxable payment - it will not be included in your 2021/22 tax return.
 

How do I get the payment

Claims can be made through your myGov account linked to your online Centrelink account.

You must submit a new claim for the first three events of lockdown or restricted movement.

When you claim from the third period (starting 15 July 2021 in parts of Sydney), Centrelink will ask you if you want automatic payments for future periods. If you agree to this, you’ll get a payment each time a new period becomes available without having to make another claim.
 

If you’re a Hnry customer

If you’re a Hnry customer, then you’ll still need to claim the support payments through your myGov account.

If you have questions about how the support payments will affect you from a tax perspective, simply get in touch with the team to talk through your options! 
 

Summary (TL;DR)

  • If you earn over $75,000 per year as a sole trader or small business and have experienced a decrease in business larger than 30%, then you can apply for the COVID-19 Business Support Grant. You could receive a lump sum payment as high as $5,000 depending on the decrease in business you have seen.
  • If you’re a sole trader or small business with turnover between $30,000 and $75,000 you can apply for the COVID-19 Micro  Business Support Grant. You could be eligible to receive a fortnightly payment of $1,500 to cover business expenses for the duration of the Greater Sydney lockdown. You can not claim both this and the personal Covid disaster payment.
  • If you’re a sole trader or small business, then you can apply for the Small Business Fees and Charges Rebate, which can offset up to $1,500 in government fees and charges for eligible NSW businesses. More detail on what can be claimed can be found here.
  • Individuals who have lost work due to the lockdown, can claim the COVID-19 Disaster Payment as outlined here. You can claim between $325-$750 per event.
  • Stay safe, go for a walk every day, and drink lots of water 😃

* This article is up to date as of the 23 August 2021, as Covid restrictions change so will this information. 


DISCLAIMER: The information on our website is for general educational purposes only. It doesn't cover all situations and circumstances, and shouldn't be taken as direct tax advice. If you're looking for specific help with your taxes, join Hnry and our team of experts can provide you with assistance tailored to your business needs.

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