Failing to plan is planning to fail.
Business owners need to be proactive during uncertain times to avoid business catastrophe and unnecessary sleepless nights.
The following 8 steps are for business owners to consider to survive then thrive.
Step 1: Assess future sales revenue for the next three months –what do you need to keep the lights on?
Consider 4 different scenarios:
- 75% expected sales
- 50% expected sales
- 25% expected sales
- No further sales
Are there any force majeure clauses in customer contract that may allow termination due to the pandemic?
Step 2: Review all non-critical expenditure & overheads – where can you trim the fat?
· Contact service & utility providers and apply for relief where available
· Review and cancel any unnecessary subscriptions
Step 3: Obtain advice about your eligibility for the recently announced government stimulus/assistance
· $1,500 JobKeeper subsidy
· $100,000 PAYGW Tax-free payment
· $150,000 instant asset write-off for any assets required for post crisis relaunch
· Apprentice Subsidy up to $21,000
· State government job support loans, where available
o QLD up to $250,000 12 months interest free
· Apply for Payroll tax refund and deferral of future payments
Step 4: Review your staff levels
· Calculate critical staff costs for post crisis relaunch
· Review all employment contracts to determine liabilities
· Determine if business meets ‘small business’ definition (less than 15 employees)
· Consider alternative arrangements:
o Work from home
o Stand down
Step 5: Negotiate with Finance Providers
· Review your loan & security documents to determine potential limiting conditions
o Requirements to notify lender for ATO or creditor payment arrangements
· Contact your bank and other finance providers and seek
o Loan deferral for 6 months
o Reduced interest rates and future charges
· Contact your business bank and seek $250,000 government backed unsecured loan
· Contact your personal bank to seek deferral on home & investment loan
Step 6: Negotiate with Landlords
· Check your eligibility for any rental relief under the Code of Conduct for commercial tenancies
· Under the Code it states that rent relief is only available to Tenants that are eligible for the JobKeeper scheme (i.e. a small-medium sized business with annual turnover of up to $50 million, which has had a reduction of at least 30% in turnover)
· Contact your landlord to discuss any negotiations
Step 7: Obtain advice about current ATO concessions
· Lodge BAS monthly versus quarterly, for faster refunds
· Vary March 2020 PAYG installment to zero
· Vary September & December 2019 Instalment to claim refund.
· Apply for a deferral of payment on BAS, income tax, FBT for up to 6 months
· Payment plans for existing tax debt
Step 8. Refresh, Reload, Relaunch
Plan your pathway out of hibernation and help unleash your potential in the post COVID-19 business world.
Refresh, Reload, Relaunch planning is designed for your to work with your Accountant to think critically about your business, the direction you need to take out of hibernation, and the action steps that need to be undertaken to get you there.
Refresh, Reload, Relaunch planning puts you in a commanding position and lines you up for success once we get back to normal (the new normal)
The above steps are generic in nature and do not take into account your personal and business circumstances. For further information download our Survive & Thrive Checklist.
Please contact Walsh Accountants to talk you through your Coronavirus survival plan or to register your interest in Refresh, Reload, Relaunch planning.
The information on assistance programs is being frequently reviewed and updated, as such this information is current as at published date.