2021 NSW COVID-19 Supports & Grants – Common Questions

Business Services, COVID - 19 / By

Due to evolving COVID-19 situation which results in constant changes to the guidelines of various business supports/grants, there is an inconsistency between the messages delivered by Service NSW and interpretation of rules. We have summarised some commonly asked questions and answered them based on information available to us as at today (16 August 2021).

For details of each grant, please refer to our blogs, Micro-Business Grant, Business Grant, JobSaver.

If you need assistance on the applications, eligibility assessments and an accountant letter for business-related grants/supports, please make bookings via the dedicated booking link here. Advisor fee will be applicable. Our services will be prioritised based on booking orders.

Common Questions & Answers

  1. What’s aggregated annual turnover for?
    • Aggregated annual turnover is used to determine which grant you can apply, either Business Grant or Micro Business Grant. If you are eligible for Business Grant due to turnover over $75,000, you are also eligible for JobSaver Payment.
    • Aggregated annual turnover is the annual turnover of your business, any business “connected with you” or any business that is your “affiliate”, for the year ended 30 June 2020.
    • Annual turnover includes all ordinary income, including trading stock sales, fees for services you provided, interest, etc. It is gross income, not net profit.
    • Annual turnover does not include GST, proceeds from selling business capital assets, certain insurance proceeds and Jobkeeper payments.
    • The method of calculating annual turnover is based on how you reported annual income in your business’ tax return for the year ended 30 June 2020. If you have used accrual method, you need to calculate annual turnover based on the same method. If you have used cash method, you need to apply cash method as well.
  2. How do I determine decline in turnover?
    • The requirement regarding aggregated annual turnover is separate to Decline in Turnover Test. Once you have determined which grants are available to your business, you need to then determine if your business have had a decline in turnover of 30% of more during the relevant test period.
    • Decline in Turnover is measured based on the current GST turnover of your business. If you calculate and lodge Business Activity Statement (BAS) based on accrual method, you will calculate the decline in turnover based on the same method. If you calculate and lodge BAS based on cash method, you will calculate the decline in turnover the same.
  3. What is the period that Decline in Turnover Test compares to?
    • There are two different concepts of periods. First, you need to find out Decline in Turnover Test periods. Then, you will also need to find out their comparison periods for comparing the declined percentage.
    • For Business Grant, the Decline in Turnover Test period is over a minimum 2-week consecutive period from 26 June 2021 to 17 July 2021, compared to:
      • The same period in 2019, or
      • The same period in 2020, or
      • The 2-week period immediately before the lockdown commenced (12 June to 25 June 2021).
    • For Micro Business Grant and JobSaver, the Decline in Turnover Test period is over a minimum 2-week consecutive period from 26 June 2021 to 28 August 2021, compared to:
      • The same period in 2019, or
      • The same period in 2020, or
      • The 2-week period immediately before the lockdown commenced (12 June to 25 June 2021).
    • The requirement of Decline in Turnover Test period is a minimum 2-week period. However, you can choose more than 14 days if that gives you a higher declined percentage.
  4. What if the decline in turnover percentage has been changed, for example, 30% under initial Service NSW guidelines but now increased to 50% due to the extended test period, how do you update your application with Service NSW?
    • It’s advised by Service NSW panel that you could write a letter to them, request the initial application to be withdrawn, explain the reason of changes, and then make a new application with the new decline in turnover percentage. Please be mindful that the process can take much longer than you expected.
  5. If a business was not operating for the full year to 30 June 2020 or 30 June 2021, how can you demonstrate the minimum decline in turnover?
    • For Business Grant, the Decline in Turnover Test period is over a minimum 2-week consecutive period from 26 June 2021 to 17 July 2021, compared to:
      • The same period in 2020, or
      • The 2-week period immediately before the lockdown commenced (12 June to 25 June 2021).
    • For Micro Business Grant and JobSaver, the Decline in Turnover Test period is over a minimum 2-week consecutive period from 26 June 2021 to 28 August 2021, compared to:
      • The same period in 2020, or
      • The 2-week period immediately before the lockdown commenced (12 June to 25 June 2021).
  6. If business structures have been changed, will I still be eligible?
    • If the business structure has been changed, e.g., from a sole trader to a company, you may still be eligible if it is a continuation of business.
  7. If a business owner has multiple businesses, how does the grant work?
    • The application of the grant is linked back to the business entity itself. If there are multiple businesses with the same ABN, such as a sole trader, there is only one entity eligible, i.e. one ABN one application.
    • If a business owner registered different entities and has multiple ABNs, the aggregated annual turnover will decide the type of grants applicable, and each entity will test Decline in Turnover on its own.
  8. Is a non-employing business eligible for the grants as well as Commonwealth COVID-19 Disaster Payment?
    • Non-employing business means a business that does not have employees. This may include a range of entity types, such as non-employing sole traders or any other businesses without employees.
    • A non-employing business is eligible to apply for the grant if all the eligibility requirements are met. However, non-employing businesses are not eligible to apply if the person associated with the business, and who derives income from it, has applied for, or are receiving, the Commonwealth COVID-19 Disaster Payment.
    • If a director of the business is classified as an employee and salary & wages have been reported in BAS, the business will be classified as an employing business and eligible for the grants. The director may also be eligible for Disaster Payment as an employee. 
  9. Is an Accountant Letter always required to show a decline in turnover?
    • A letter from a Practitioner (which can include a qualified accountant, a registered tax agent, or a registered BAS agent) confirming the decline in turnover must be lodged if:
    • Your business is not on the “highly impacted industries list”.
    • Non-employing accounting businesses (e.g. sole traders) must submit a letter from a practitioner that is independent of the business.
    • You can resubmit the Letter for JobSaver if you have submitted an Accountant Letter for Business Grant application.
  10. If I am eligible for both Business Grant and JobSaver, do I need to submit applications for both?
    • The Service NSW website indicates that if you are eligible for Business Grant, you are generally eligible for JobSaver. You will need to submit the applications for both. It’s recommended that you wait for the application of the Business Grant to be assessed and paid, then you submit the application for JobSaver.
  11. Can I stood down my employees and still be eligible for headcount?
    • For employing businesses, you must maintain your employee headcount from 13 July 2021 while you continue to receive payments under Business Grant and JobSaver.
    • You will need to notify the employee headcount declines over the period of payment due to any actions of the business. You are still eligible if the headcount decline is due to the circumstance out of your control, such as voluntary resignation by the employees.
  12. If I am a business owner but not eligible for any grant, what supports do I have?
    • If your aggregated annual turnover is less than $30,000 which makes you ineligible for Micro Business Grant, you can apply for Disaster Payment if your working hours have been reduced due to the lockdown measurements.
  13. If I am a micro business owner, I would receive the same amount under Micro Business Grant and Disaster Payment. Which one should I apply? 
    • For Micro Business Grant, once your application is approved, the payment is backdated from 26 June 2021, but it may take longer for the payment to come. If you apply for Disaster Payment instead, the payment will be much sooner, but you may not be able to claim the full lockdown period. Claims for the week of 1 July close on 28 July 2021 and weekly thereafter, e.g., claims for the week of 8 July close on 4 August 2021 and so on.
  14. Do I need to pay back the grants left over after spending on eligible expenses?
    • The business may retain the monies on the condition that they have spent on eligible expenses that arise in the future and retain evidence.
    • Successful applications may be subject to audits and you will need to keep all documentary evidence for a minimum of 5 years.
    • The eligible expenses may include, but are not limited to, the following expenses:
      • Salaries and wages;
      • Utilities and rent;
      • Financial, legal or other expense, or
      • Other business costs, etc.

If you need any assistance on the grant assessments, please do not hesitate to contact us on (02) 8897 2606.

Please note that the material and contents provided are informative in nature only. It is not intended to be advice and you should not act specifically on the basis of this information alone. If expert assistance is required, professional advice should be obtained.

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