In response to continuing financially uncertain times for small businesses, the Government has extended the Small Business Cash-flow (loan) Scheme (SBCS) to the end of 2020.
Applications for the Scheme opened on 12 May 2020 and can now be submitted up to and including 31 December 2020.
What is the SBCS?
The SBCS was introduced by the Government in May 2020 to provide eligible small businesses with financial relief in the form of a one-off loan. The maximum amount available for loan is $10,000, with an additional $1,800 per full-time equivalent employee.
The loan is interest-free in the case that businesses fully pay it back within one year of the loan’s issuance. However, businesses taking more than one year will be charged at 3% interest per annum, starting from the date of the loan being provided.
Is your business eligible for the SBCS?
Businesses must have 50 or fewer full-time-equivalent employees to be eligible for the loan. Businesses must also be ‘viable’, meaning the directors or owners have good reason to believe that it is likely the business will be able to pay its debts as they fall due within the next 18 months. Record-keeping is essential to proving your business is viable and may include:
- a short-term cash-flow forecast for the business,
- a plan for where future revenue will come in market conditions,
- financial statements showing the business or organisation has enough resources (including the SBCS loan) to sustain itself,
- an accountant’s assessment that the business is viable.
How can you apply for the SBCS?
Businesses can only apply for the SBCS loan through myIR. In the case that your business is receiving a wage subsidy, only apply for the SBCS when your wage subsidy is $351,490 or less when applied to all of your employees.
