The Government has introduced the Small Business Cashflow (loan) Scheme (SBCS) to support businesses and organisations struggling because of loss of revenue as a result of COVID-19.
Tax agents will not be able to apply for the loan on behalf of business owners.
Overview
- The loan has a five-year term and must be repaid by 31 July 2025.
- The annual interest rate will be 3% beginning from the date of the loan being provided.
- Interest will not be charged if the loan is fully paid back within one year. Repayments are not compulsory in the first 24 months.
- In most cases, businesses will be entitled to a loan amount of $10,000 plus $1,800 per full-time-equivalent employee, to a maximum of $100,000.
- Will be open from 12 May 2020 up to and including 12 June 2020.
- Business or organisation must have 50 or fewer full-time-equivalent employees eligible for the Wage Subsidy Scheme.
- There should also be a sound plan for business’ viability and must hold information on file to verify this (ex. Accountant’s Assessment). We highly recommend getting the FREE Business Continuity Plan and Projected Cashflows under the $5000 government grant. If you haven’t been in touch with us about this please contact us urgently as this grant closes in June.
Payment
- Most will receive funds within five working days.
- IRD will administer the payments and repayments of this scheme.
Businesses should speak with their financial advisors before taking this loan.
Details about eligibility criteria and applying for the loan can be found here.