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1. About the program

1.1 On 27 December 2021, the Public Health (COVID-19 General Order (No 2) 2021 (the Public Health Order) imposed density restrictions on hospitality venues and nightclubs. On 8 January 2022, singing and dancing was banned in certain venues, and on 11 January restrictions were imposed on music festivals. These restrictions, while aimed at curbing the spread of COVID-19, have directly impacted the operation of some businesses, including hospitality businesses, performing arts businesses, nightclubs, and some entertainment venues.

1.2 Other businesses, while not directly impacted by the above Public Health Order, have been negatively impacted by COVID-19. Many consumers are avoiding public places, and businesses are experiencing supply chain disruptions and staff shortages because of COVID-19 infection and close contact isolation requirements.

1.3 The 2022 Small Business Support Program will provide cash flow support to help businesses survive the immediate impacts of the current Omicron wave of COVID-19 and maintain employee-employer relationships.

1.4 Service NSW and Revenue NSW will deliver the Small Business Support Program on behalf of the NSW Government.

1.5 By applying for the Small Business Support Program, applicants agree:

i. their application may be subject to an audit by the NSW Government or its representatives, and agree to participate in and cooperate with the process if requested, and

ii. Service NSW and Revenue NSW may use other data provided by applicants to other government agencies, or other levels of government, to assist with determining eligibility for the Small Business Support Program.

1.6 A public reporting channel has been established to allow people to report businesses not adhering to these Guidelines.

2. Available funding

2.1 A reference to ‘business’ or ‘businesses’ in these guidelines should be interpreted as including both business(es), registered charity(ies) and other not-for-profit organisation(s).

2.2 Eligible businesses will receive one payment covering the four-week period of February 2022. Businesses will not receive payment for January 2022.

2.3 Eligible employing businesses will receive the equivalent of 20 per cent of weekly payroll for work performed in New South Wales:

i. the minimum payment will be $750 per week, and

ii. the maximum payment will be $5,000 per week.

2.4 Eligible non-employing businesses will receive $500 per week.

Calculating weekly payroll

2.5 Weekly payroll should generally be determined by referring to the calculations underlying the most recent Business Activity Statement (BAS) or Instalment Activity Statement (IAS) provided to the Australian Taxation Office (ATO) for a tax period that falls within the 2021–22 financial year. Item W1 in the BAS or IAS includes amounts of wages, salaries and other payments that are subject to PAYG withholding tax.

2.6 Payments subject to withholding tax in W1 includes allowances, leave loading, director fees and termination payments but does not include payments such as superannuation contributions, amounts subject to salary sacrifice, interest or dividends. For the purposes of calculating weekly payroll, businesses should deduct amounts from W1 that have been withheld on behalf of contractors under voluntary agreements.

2.7 Businesses that only operate within New South Wales should first identify the amount reported under item W1 in the relevant BAS or IAS and deduct any amounts withheld on behalf of contractors. That amount should be divided by the number of calendar days reported in the PAYG tax withheld section of the BAS or IAS period and multiplied by 7. This will give the weekly payroll amount.

2.8 Businesses that also operate in other states or territories should use the same approach as reporting to the ATO on W1 to calculate the amount of wages, salaries and other amounts paid to employees who usually worked or were based in New South Wales during the relevant BAS or IAS period. Amounts voluntarily withheld on behalf of contractors in New South Wales should then be deducted. That amount should be divided by the number of calendar days reported in the PAYG tax withheld section of the BAS period or IAS and multiplied by 7. This will give the weekly payroll amount.

2.9 Businesses that do not submit a BAS, IAS or have no W1 amount should use the ATO definition of W1 to calculate the total wages, salaries and other amounts, excluding amounts withheld on behalf of contractors, for employees who usually worked, or were based, in New South Wales in the month of November or December 2021 (whichever is most reflective of business-as-usual). That amount should be divided by the number of calendar days in the month and multiplied by 7. This will give the weekly payroll amount.

3. Eligibility criteria

3.1 Businesses impacted by COVID-19 will be eligible if they:

a) had an Australian Business Number (ABN) and were operating in New South Wales on 1 January 2021

b) had an aggregated annual turnover of between $75,000 and $50 million (inclusive) for the year ended 30 June 2021 or 30 June 2020 (must use the financial year for the Australian Tax Return most recently lodged with the ATO)

c) experienced a decline in turnover of 40 per cent or more due to the impacts of COVID-19 during the month of January 2022, compared to January 2021 or January 2020

d) experienced a decline in turnover of 40 per cent or more due to the impacts of COVID-19 from 1–14 February 2022 compared to the same fortnight in February in the comparison year used for criterion (c) above, and

e) maintain their employee headcount from 30 January to 28 February 2022.

3.2 Businesses must have experienced a decline in turnover due to COVID-19 which has, for example, impacted the business through reduced consumer demand, labour shortages and supply chain disruptions. Businesses that have experienced a decline in turnover for other reasons, such as seasonal variations, or the business closing for the holiday period or for renovations, are ineligible.

3.3 Certain entities, such as those primarily earning passive income (rents, interest, or dividends), government agencies, local governments, banks and universities are not eligible for the Small Business Support Program. The full list of ineligible businesses is at Attachment B.

3.4 Where the annual turnover of non-employing businesses is aggregated with employing business(es) for the purpose of calculating aggregated annual turnover, the non-employing businesses are ineligible to apply.

3.5 For non-employing businesses, the business receiving payments must be the primary income source (i.e. 50 per cent or more of total income) for the associated individual. Where an individual is associated with more than one non-employing business, only one of the businesses (with whom that individual is associated) may claim payment.

3.6 Employees can receive Commonwealth Pandemic Leave Disaster Payments if their employer is receiving payment under the Small Business Support Program.

3.7 Non-employing businesses can also receive payment under the Small Business Support Program if individuals associated with and deriving income from the business receive a Commonwealth Pandemic Leave Disaster Payment for the same period.

3.8 Registered charities are not eligible if they are receiving COVID-19 support from the NSW Department of Communities and Justice Social Sector Support Fund (SSSF).

4. How funding may be used

4.1 The Small Business Support Program payment will help eligible businesses cover business costs and survive the immediate impacts of the Omicron wave of COVID-19. These costs may include, but are not limited to, the following expenses:

a) salaries and wages

b) utilities and rent

c) financial, legal or other advice

d) marketing and communications

e) perishable goods, or

f) other business costs.

5. Application process

5.1 Applications will open on 16 February 2022 and close after 11:59pm on 29 April 2022.

5.2 Applicants will be required to complete an online application form through the Service NSW website. The evidence requirements are outlined in section 6.

5.3 Payments will be made in one lump sum covering the four weeks in February 2022.

5.4 Businesses must notify Service NSW if they are not maintaining their employee headcount in accordance with these guidelines.

6. Evidence in support of eligibility

6.1 All businesses applying for the 2022 Small Business Support Program must:

a) if they have employees:

i. declare their employee headcount on 30 January 2022, and

ii. declare they will maintain their employee headcount over the period from 30 January to 28 February 2022

b) if they do not have employees, declare the business is the primary income source for the individual associated with the business (i.e. 50 per cent or more of total income)

c) submit their most recently lodged Australian Income Tax Return with tax file numbers redacted (for year ended 30 June 2020 or 30 June 2021 only) to demonstrate the business had an aggregated annual turnover of between $75,000 and $50 million (inclusive)

i. businesses that have a substituted accounting period (SAP) (i.e. do not have an income tax year end of 30 June 2021), can provide the business’ lodged Australian Income Tax Return for the last financial year ended prior to 30 June 2021

ii. businesses that have received a ruling from the Australian Taxation Office relating to ‘control’ may submit that ruling as evidence of entities connected with them for the purposes of determining aggregated annual turnover)

iii. registered charities can also submit their most recent BAS, ACNC Annual Information Statement (AIS), or other documentation to demonstrate their registered charity had an aggregated annual turnover of between $75,000 and $50 million (inclusive) for year ended 30 June 2020 or 30 June 2021

d) provide evidence of how the weekly payroll amount was calculated:

i. for businesses that submit a BAS or IAS with a W1 amount (wages and salaries) recorded: the BAS or IAS that was most recently submitted to the ATO for a tax period that falls within the 2021–22 financial year

ii. for businesses that submit a BAS without a W1 amount (wages and salaries) recorded: their 2020–21 NSW payroll tax reconciliation return, and copies of the payroll report/s filed with the ATO using Single Touch Payroll, which include information used in the calculation of weekly payroll (after redacting all personally identifiable information). The Single Touch Payroll report should include the effective date, branch ID, Submission ID, Event Type, Gross payments and PAYGW

iii. for businesses that do not submit a BAS or IAS: copies of the payroll report/s filed with the ATO using Single Touch Payroll, which include information used in the calculation of weekly payroll (after redacting all personally identifiable information). The Single Touch Payroll report should include the effective date, branch ID, Submission ID, Event Type, Gross payments and PAYGW

iv. for businesses that do not submit a BAS, IAS, or payroll reports using Single Touch Payroll: contact Service NSW to discuss alternate evidence of wages and salaries, and

e) lodge other supporting documents as required to demonstrate that the business meets the eligibility criteria.

6.2 For businesses directly impacted by the Public Health Order and listed at Attachment A:

a) declare that they experienced a decline in turnover of 40 per cent or more due to COVID-19 in January 2022 compared to January 2021 or January 2020

b) declare that they experienced a decline in turnover of 40 per cent or more due to COVID-19 from 1–14 February 2022 compared to the same fortnight in February in the comparison year used for January’s decline in turnover, and

c) identify how the Public Health Order has directly impacted the turnover of the business.

6.3 Other businesses that meet the eligibility criteria but have ANZSIC codes not listed in Attachment A must:

a) submit supporting evidence to demonstrate a 40 per cent decline in turnover due to COVID-19 during the month of January 2022, compared to January 2021 or January 2020 through either:

i. Business Activity Statements or Instalment Activity Statements for January 2022 and January 2021/January 2020, or

ii. a letter from a qualified accountant, registered tax agent or registered BAS agent

  • non-employing accounting businesses (e.g. sole traders) must submit a letter from a qualified accountant, registered tax agent or registered BAS agent that is not an employee or director of the business, an associated entity of the business, or a director or employee of an associated entity of the business

b) declare that they experienced a decline in turnover of 40 per cent or more due to COVID-19 over the period from 1 to 14 February 2022 compared to the same fortnight in February in the comparison year used for January’s decline in turnover, and

c) identify how COVID-19 has impacted the turnover of the business.

Calculating decline in turnover

6.4 Decline in turnover will be measured based on the modified Goods and Services Tax (GST) turnover of the business. As such, if you report GST turnover on your BAS to the ATO on an accrual basis, you should use this method. If you report GST turnover on your BAS to the ATO on a cash basis, you should use this method.

6.5 Registered charities, other than schools or universities, should include gifts (e.g. donations) and Government grants when calculating decline in turnover.

6.6 Not-for-profit organisations that are not registered charities should exclude gifts and include Government grants when calculating decline in turnover.

6.7 All other businesses should include Government grants when calculating decline in turnover.

Supporting evidence

6.8 The letter from a qualified accountant or tax professional to show decline in turnover will be from either a:

a) qualified accountant as defined in the Corporations Act 2001 (Cth)

b) registered tax agent as defined in the Tax Agent Services Act 2009 (Cth), or

c) registered BAS agent as defined under the Tax Agent Services Act 2009 (Cth).

6.9 A template is available on the Service NSW website setting out what the accountant or tax professional’s letter must include. If an applicant is not able to provide a Business Activity Statement, Instalment Activity Statement, or a letter from a qualified accountant or tax professional to verify their decline in turnover, they should contact Service NSW on 13 77 88.

6.10 Businesses submitting an Australian Income Tax Return for the year ended 30 June 2020 as proof of aggregated annual turnover may be requested to provide additional information to prove the business has operated in the 12 months to 31 January 2022.

Alternative circumstances

6.11 Businesses operating in New South Wales with their ABN registered business address outside New South Wales will be able to apply if they can provide evidence their business was operating in New South Wales on 1 January 2021. Evidence to demonstrate this includes commercial rates notices or lease agreements. Where a rates notice or lease agreement is not available, Service NSW may accept a combination of the following:

a) utility bills

b) insurance papers

c) supply invoices

d) registration papers, or

e) contractor licences.

6.12 There are several circumstances where a business may not meet the eligibility criteria and supporting evidence requirements, but may still be eligible for the Small Business Support Program. These circumstances include:

a) new businesses not operating on 1 January 2021

b) businesses affected by drought, bushfires or other natural disasters

c) business acquisition, disposal or business restructure that has impacted the business’ turnover

d) a sole trader or small partnership impacted by sickness, injury or leave

e) businesses that are a group employing entity with the principal function of supplying employee labour to other members of a Group.

6.13 Alternative rules for these businesses are provided at Attachment C.

6.14 Where a business operates through a trust structure, the applicant will be required to provide additional information to demonstrate an aggregated annual turnover of between $75,000 and $50 million (inclusive) is derived through the trust. The entity operating the business is eligible for the Small Business Support Program, not other entities that are receiving passive income from the business.

6.15 Service NSW can request a combination of the following documents to support the determination of eligibility:

a) letter from a qualified accountant or tax professional

b) Business Activity Statements

c) Instalment Activity Statements

d) income tax return declarations

e) audited profit and loss statements

f) receipts and invoices from purchases, or

g) NSW payroll tax reconciliation returns.

6.16 Where a business is unable to provide these documents, or where Service NSW is satisfied it has other suitable methods to determine eligibility, Service NSW may accept other forms of documentation.

6.17 Businesses requiring assistance with their online application can contact Service NSW on 13 77 88.

7. Definitions

Aggregated Annual Turnover: means aggregated turnover as defined in s. 328–115 of the Income Tax Assessment Act 1997 (Cth) (“ITAA 97”). Aggregated turnover includes the annual turnovers of entities (including foreign entities) that are connected with, or affiliates of, the business entity. The ATO has further information on calculating aggregated turnover.

For registered charities, other than schools or universities, when calculating aggregated annual turnover, gifts and Government grants should be included.

For not-for-profit organisations that are not registered charities, gifts should be excluded and Government grants included when calculating aggregated annual turnover.

Applicant/s: is someone named as an associate or contact on the Australian Business Register.

Business: an entity carrying on a business as per the Corporations Act 2001 (Cth) with an ABN.

Decline in turnover: an entity satisfies the decline in turnover test for a month if the entity’s current GST turnover for the month falls by at least 40 per cent compared to the relevant comparison period.

  • Current GST turnover has the meaning given by the Income Tax Assessment Act 1997 (Cth) and section 188–15 of the A New Tax System (Goods and Services Tax) Act 1999 (Cth) (“GST Act”).
  • Modifications: In calculating current GST turnover, an applicant would need to make the following adjustments:

a) when calculating turnover for the fortnight from 1–14 February 2022:

i. section 188–15 of the GST Act applies as if a reference to a month were a reference to the fortnight;

ii. subsection 188–15(1) of the GST Act is to be applied at the end of the fortnight;

iii. subsection 188–15(1) of the GST Act has effect as if the reference in that subsection to “, or are likely to make, during the 12 months ending at the end of that month,” were instead a reference to “during that fortnight”;

b) subsection 188 15(2) of the GST Act (about members of GST groups) is to be disregarded;

c) each external Territory is treated as forming part of the indirect tax zone (within the meaning of the GST Act).

  • Modifications – Registered charities: In calculating current GST turnover:

a) For an entity that is a deductible gift recipient or a registered charity – each gift received by the entity in the period (other than from an associate) results in the following treatment:

i. the entity is treated as making a supply in the period for consideration, and

ii. the value (within the meaning of the GST Act) of the supply is treated as being equal to the amount of the gift (if the gift is money) or the market value of the gift (if the gift is not money).

b) Include, for the avoidance of doubt, any supply made by an entity to which paragraph (a) of this modification applies if consideration for the supply was provided by an Australian government agency, a local governing body, the United Nations, or an agency of the United Nations.

c) For an entity covered by paragraph (a) – an amount or property received (unless received as consideration for a supply covered by paragraph (b)) by the entity from an Australian government agency, a local governing body, the United Nations, or an agency of the United Nations results in the following treatment:

i. the entity is treated as making a supply in the period for consideration; and

ii. the value (within the meaning of the GST Act) of the supply is treated as being equal to the amount (if money) or the market value of the property (if not money).

Employee has the same meaning as its ordinary or common law meaning. Where it is not known whether there is an employee/employer relationship, businesses and non-profits should consider the guidance provided by the ATO.

For the purposes of this program, references to an employee include a religious practitioner of a religious institution if the religious practitioner meets the following criteria:

a) they are not employed by the religious institution

b) they are a minister of religion or a full-time member of a religious order and were undertaking activities in pursuit of their vocation as a member of the religious institution as at 30 January 2022

c) they receive from the religious institution a payment for undertaking activities in pursuit of their vocation as a religious practitioner and as a member of the religious institution

d) on 30 January 2022, they were both:

i. aged at least 18 (or were 16 or 17, and were independent or not undertaking full-time study), and

ii. an Australian resident (within the meaning of section 7 of the Social Security Act 1991 (Cth)), or a resident for income tax purposes and the holder of a special category (Subclass 444) visa.

Employee headcount: the number of persons who are employed in New South Wales and who are permanent (full-time or part-time), or casual staff who have been employed by the business for more than 12 months.

Maintain their employee headcount means the employer will not take active steps to end the employment relationship with their employees. Employees who have been stood down under the Fair Work Act 2009 (Cth) or take leave without pay are considered employees for the purpose of the headcount. Businesses will remain eligible if their employee headcount declines for reasons outside the control of the employer, for example if employees voluntarily resign, die or retire.

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.

Not-for-profit organisation means an entity whose principal objective is not the generation of profit. A not-for-profit entity can be a single entity or a group of entities comprising the parent entity and each of the entities that it controls.

Payroll means the Australian Tax Office (ATO) concept of total salary, wages and other payments, as declared at W1 in a Business Activity Statement (BAS) or Instalment Activity Statement (IAS) with respect to the payments made for employees who usually worked, or were based, in New South Wales.

Qualified accountant, registered tax agent or registered BAS agent means a person who is a:

a) qualified accountant as defined in the Corporations Act 2001 (Cth);

b) registered tax agent as defined under the Tax Agent Services Act 2009 (Cth); or

c) registered BAS agent as defined under the Tax Agent Services Act 2009 (Cth).

Registered charity means an entity that is registered with the Australian Charities and Not-for-profits Commission (ACNC) as at 30 January 2022.

Religious institution means an entity that was:

a) an ACNC-registered charity, registered under the sub-type ‘advancing religion’ as at 30 January 2022; and

b) on 30 January 2022 was one of the following:

i. a non-profit body that pursued its objectives principally in Australia, or

ii. a deductible gift recipient (DGR) endorsed, under the Overseas Aid Gift Deductibility Scheme (DGR item 9.1.1) or for developed country relief (DGR item 9.1.2), either as a public fund or for a public fund it operated.

8. Attachment A: Small Business Support Program – industries directly impacted by the Public Health Order

ANZSIC Code Examples of businesses captured (non-exhaustive)

 

4511 – Cafés and Restaurants

  • Bistro, café, canteens, and cafeteria operation
  • Self-employed contracted chefs
  • Hotel licensee – mainly restaurant operation
  • Restaurant operation
  • Dine and dance establishment

 

4520 – Pubs, Taverns and Bars

  • Pub and bar operation
  • Nightclub and discotheque operation
  • Hotel bar and hotel licensee (mainly drinking place)
  • Wine bar and saloon operation

 

4530 – Clubs (Hospitality)

  • Bowling and golf club with hospitality
  • RSL club operation
  • Licensed sports clubs (e.g. League, Yacht clubs)

 

9001 – Performing Arts Operation

  • Music and theatre productions operation
  • Performing arts operation
  • Choir, opera and orchestra operations

 

9002 – Creative Artists Musicians Writers and Performers

  • Actors, comedians, magicians, artists and celebrities
  • Writers, journalists, media presenters and radio announcers
  • Film production, set design and construction design 

 

9003 – Performing Arts Venue Operation

  • Concert, opera, and music hall operation
  • Theatre operation (except motion picture theatre)
  • Entertainment and performing arts venue operation
  • Performing arts venue operation

9. Attachment B: Ineligible businesses

A business is not eligible for the Small Business Support Program if any of the following apply:

  • the Major Bank Levy was imposed on the business or a member of its consolidated group for any quarter before 1 January 2022
  • the business is an Australian government agency (within the meaning of the Income Tax Assessment Act 1997)
  • the business is a state or local governing body
  • the business is wholly owned by an Australian government agency or local governing body
  • the business is a company in liquidation or provisional liquidation
  • the business is an individual who has entered bankruptcy
  • the business is in administration
  • the business has not traded in the 12 months to 31 January 2022
  • the business has been found to have been engaged in fraud
  • the business is a Table A provider within the meaning of the Higher Education Support Act 2003 (Cth)
  • the business registered its Australian Business Number (ABN) after 1 January 2021, or has backdated its ABN to before 1 January 2021 for the purposes of eligibility (unless the business can demonstrate eligibility under Attachment C)
  • the business is a sovereign entity, or would be a sovereign entity if subparagraphs 880–15(c)(ii) and (iii) of the Income Tax Assessment Act 1997 were disregarded
  • where passive income, such as rent, interest, dividends and royalties, is more than 50 per cent of the business’ income (note: if passive income is more than 50 per cent of a business’ income but the business is actively providing services that relate to the passive income, the business should contact Service NSW to discuss their circumstances).

10. Attachment C: Alternative rules for businesses that do not meet standard eligibility criteria for the 2022 Small Business Support Program payment

Alternative circumstances How to demonstrate aggregated annual turnover How to demonstrate decline in turnover

1. Businesses not operating on 1 January 2021

(Note: businesses must have been operating on 1 October 2021 to be eligible for support.)

2. Businesses that have been impacted by acquisition, disposal, or restructure

3. Sole trader or small partnership impacted by sickness, injury or leave

Businesses applying for the Program must show the equivalent of $75,000 or more in aggregated annual turnover (but cannot have aggregated annual turnover equivalent to more than $50 million).

If a business is unable to demonstrate turnover for a full year, a shorter period can be accepted provided that shorter period is representative of the “normal operating environment” of the business. The turnover for this shorter period will be annualised to get an equivalent annual turnover figure for the business.

Businesses should generally use a minimum three-month period to demonstrate turnover, and should provide:

  • a Business Activity Statement (BAS) for at least one quarter (Q1 or Q2 of FY2021–22), or
  • an Australian Income Tax Return annotated to show when the business commenced during the financial year.

Where a business does not have the evidence outlined above, the following may be provided as evidence of annual turnover:

  • letter from a qualified accountant, registered tax agent or registered BAS agent; or
  • business bank account statement for a minimum three-month period (separate from any personal accounts).

Businesses must show a decline in turnover in January 2022 and from 1–14 February 2022 due to the impacts of COVID-19 compared to the alternate comparison periods outlined below.

For businesses not operating on 1 January 2021:

  • the average turnover in Q1 or Q2 of FY2021–22.

For businesses that have been impacted by acquisition, disposal, or restructure:

  • as per the guidelines if previous financials are available, or
  • the average turnover in Q1 or Q2 of FY2021–22.

For sole trader or small partnership impacted by sickness, injury or leave:

  • as per the guidelines if the business was operating in January and February in 2021 or 2020, or
  • the average turnover in Q1 or Q2 of FY2021–22.
4. Businesses impacted by natural disasters, such as drought, bushfire and floods that cannot otherwise use the eligibility criteria As per above As per the guidelines, or a business can show a decline in turnover of 40 per cent or more due to COVID-19 in January 2022 and from 1–14 February 2022 compared to the same periods in 2019.
5. Businesses that are a group employing entity with a principal function of supplying employee labour to other members of the Group* As per the guidelines The business may use the sum of the current GST turnovers of the group members to which it supplied employee labour services in January 2022 and from 1–14 February 2022 and in the relevant comparison periods used to calculate decline in turnover as outlined in the guidelines.

* An entity will be a group employing entity with a principal function of supplying employee labour to other members of the Group where:

  • the circumstances described in paragraphs 8A(1)(a)–(b) of the Coronavirus Economic Response Package (Payments & Benefits) Rules 2020 (“JobKeeper Rules”) would apply to the entity for the whole of the period that is used for the purpose of assessing decline in turnover, and for the whole of the relevant comparison period; and
  • the circumstances described in paragraph 8A(2)(a) of the JobKeeper Rules would also apply to the business, if the reference to “a turnover test period during which the test time occurs” were instead a reference to the 2022 comparison periods as outlined in the guidelines.