The Australian Government has so far unveiled over $320 billion worth of rescue packages to support businesses and individuals deemed to be suffering the economic consequences of the novel coronavirus. But, somehow, we have been excluded.
I have almost daily contact with my accountant to discuss each new assistance package announcement and each one, time and time again, passes us by.
We aren’t entitled to so much as a sneeze.
I don’t want to sound dismissive of the support packages already announced as I’m sure that there is good reasoning behind them all. I admire our Government’s effort to support as many people as possible and stave off this crisis. And I’m sure there’s a lot of grateful business owners and individuals out there.
Like most hotels (unless being utilised in cities by the State Governments for quarantine purposes) we have no guests. No guests mean no income. We can’t afford, nor have work for, our small and wonderful staff.
Our casual cleaner, now unemployed, should be OK though. We weren’t entitled to claim the JobKeeper allowance for her as she was with us five weeks short of 12 months, however on the JobSeeker allowance she will still earn $21 per week more than when she was working 18 hours per week for us.
Our part-time manager, now unemployed, should be OK too. As a contractor and Sole Trader, she will average $1000 a month more on the JobKeeper allowance than when she was working part-time for us.
So what assistance is available for our business, to allow us to still meet such expenses as rates, land tax, business & building insurances, utilities, building and garden maintenance, Booking software subscriptions, etc.? Well the Boosting Cash Flow for Employers Initiative is definitely welcomed by us.
Fortunately, we had transitioned our cleaner to casual and she was on payroll, so we are entitled to $10,000 credit toward our BAS. Subtract our average BAS debt though, and we can look forward to maybe $6000 benefit. This is to see us through until the next quarter.
Six-thousand dollars (equating to $250 week each for my husband and I) for all our business expenses plus our personal expenses. Because neither of us were on the payroll, instead taking drawings as required, we aren’t entitled to any other assistance. No Jobkeeper or Jobseeker allowance for us. Somehow that $250 per week each will also need to meet our personal costs -: rates, home/health/car insurances, rego, utilities and food!
Should we be appreciative that, when we fall into the debt as we inevitably will, that creditors can’t issue a statutory demand on our company for a few months? Should we be appreciative of the Instant Asset Write-Off threshold increase or the Accelerated Depreciation changes? I don’t foresee us investing in our business or acquiring assets without an income so I’m not sure how to best utilise this initiative. Perhaps we should be appreciative that the government will support and encourage the banks, through the SME Guarantee Scheme, to lend us money to get through this period; however, it’s hard to look forward to acquiring a debt to merely cover our expenses.
My husband and I are fortunate. We don’t have a home or business loan. I’m not sure that too many other small hotel owners are so lucky. If we are filled with fear and dread for our financial future, how on earth are other business owners feeling?
Update: Friday morning our Federal Member called me (Kevin Hogan) in response.
He had heard of others not being entitled to anything due to not being on payroll, however encouraged us to apply for JobSeeker allowance – albeit not at all sure if we would meet the criteria. As such I spent over an hour trying to do just that however with typical business structures of trusts and companies, this is an agonizing process and one that I still am not confident will work due to the ‘value’ of our freehold hotel land and buildings.
He asked me to update him if I have any luck but agreed that the Federal Govt. need to look into this further due to businesses like us who have slipped through the cracks.