Recorded on the 16th of April 2020
Our expert panel:
- Nick Klein, Principal at LBW Business + Wealth Advisors
- Michael De Stefano, Director at Gartland Property
- Lauren Saunders, Senior Manager at Bendigo Bank
- Scott Andersen, Partner at Worrells Solvency & Forensic Accountants
- The JobKeeper is more complicated than first thought since the Prime Minister’s first announcement. At this point businesses have only registered their interest to get updates from the government for further information. On the 4th of May they will open up enrolment officially for the Job Keeper program, the government will then see if your business and staff are eligible.
- You need to compare your revenue turn over to the previous year’s turnover. Look at March this year to March last year, April this year to April last year. If you have seen a 30% drop in revenue, then you are eligible for the Job Keeper. The JobKeeper payments are deductible.
- Go through the JobKeeper process, keep paying your employees and talk to your bank to help you keep up those wage payments. If you don’t make those wage payments to staff you won’t get the payments back from the job keeper allowance. You have to be making payments to staff before April 1st.
- You can get support to navigate the JobKeeper allowance through Economic Development through The City of Greater Geelong, The Victorian Chamber of Commerce and your finance adviser.
- Business owners who don’t take a wage can be eligible for the job keep allowance, this could be vital for owners to help them get through this time.
- Rent relief is coming from the state government, but this is in the early stages currently. You need to access the avenues you have currently, then waiting for the rent relief to come.
- In terms of renters or those leasing business properties dealing with their landlords and their property manager they need to be transparent, put all of your cards on the table. Chat to your financial adviser and accountant to make cuts where necessary to help make rent payments. Open communication and you need to supply what downturn you have had. You will get a far better result; you need to remove the tenant vs landlord mentality.
- Most people want to do the best by other people, talk with your landlord or agent to get a fair agreement about how things will move forward during the crisis.
- Investors will have the comfort that interest rates will hold at a very low rate for the next few years, the uncertainly comes from tenant stability.
- Deferring or reduced business loan payments over a period of times are all options for business clients with their banks. There could be even the possibility of waving account fees and reduced interest rates as well. Talk to your bank and work with them on what is possible in terms of some relief.
- Insurance companies and other services are open to reducing fees and other costs as well, you should give them a call and start chatting to see what is possible.
- No one wants to think about having to stand down one’s business but this has to be look at as an option if things come to a standstill. Always look to experts in this field for guidance as there are many options for how this plays out and not all of them are final.
- If you’re looking at standing down your business through the COVID-19 crisis for various reason you can look at involuntary administration if you’re a corporate entity. This will allow you to re-start the business after the crisis and be in the best possible position and maximize benefits. This will allow a business to consolidate debts and make deals with lenders.
- A business can choose to make themselves insolvent and liquidate themselves. This is a personal insolvency agreement; this allow a business to control the process. This allow you to make deals with your bank and mitigate any further financial risks.
- For some businesses especially sole trader’s, formal bankruptcy maybe the better fit for them. You can then look at the bankruptcy act for guidance. The best this to do is chat with your solicitor and financial adviser.
