Loan features
The loan features are as follows:
- $500 million loan scheme
- Maximum loan amount for these loans is 50% of your operation’s annual wage expense (to a maximum of $250,000)
- No repayments or interest charged for the first year
- Plus two years interest only (so principal and interest repayments will start in the third year)
- 2.5% fixed interest rate
- 10-year term of loan
- Unsecured up to $100,000. Loans over $100,000 will need a General Security Agreement (which is a general charge over business assets)
- You can apply more than once but in total you cannot borrow more than the maximum loan amount
- Business owners without employees may also be eligible (provided they work hours in the business equal to at least one full time equivalent employee (35 hours per week))
- Open until 25 September 2020 or until funding is fully committed
Eligibility
To be eligible loan applicants must:
- Be an eligible business which holds an ABN and is registered for GST
- Have one or more equivalent full-time employees in Queensland
- Have operated the business since 1 July 2017
- Have suffered a loss as a result of COVID-19
- Be viable under normal business conditions
- Be able to service the loan under normal business conditions
- Intend to continue operations after receiving the loan
- Intend to use any surplus liquid reserves or normal credit sources up to normal credit limits, in conjunction with the loan to continue operations.
Application information
- Business financial statements for the 2017-18 and 2018-19 financial years
- Personal taxation returns for 2017-18 and 2018-19
- Bank account information
- Australian Taxation Office Integrated Client Account Statements
- Aged list of debtors and creditors at time of application
- Applicant information
- Organisation Constitution or Rules of Association and Certificate of Incorporation (if applying as a non-profit organisation)
- Trust deed (if applying as a trust)
How loan may be used
The loans may be used to meet working capital expenses, for example:
- Paying employee wages
- Paying creditors and existing business loan and equipment finance payments
- Paying rent and rates
- Buying goods (including fuel) for the purposes of carrying on the business.
The loan cannot be used for:
- refinancing existing business loans or equipment finance;
- purchasing new equipment or other assets.
Where to apply?
You can apply now via QRIDA: http://www.qrida.qld.gov.au/current-programs/covid-19-business-support/queensland-covid19-jobs-support-scheme
DISCLAIMER: The information in this article is general in nature and is
not a substitute for professional advice. Accordingly, neither TJN
Accountants nor any member or employee of TJN Accountants accepts any
responsibility for any loss, however caused, as a result of reliance on
this general information. We recommend that our formal advice be sought
before acting in any of the areas. The article is issued as a helpful
guide to clients and for their private information. Therefore it should
be regarded as confidential and not be made available to any person
without our consent.