1. About the Program
1.1 The objective of the Small Business Northern Flood Grant program ('the Grant') is to support small businesses in northern New South Wales impacted by the February and March 2022 flooding event.
1.2 The $10,000 Grant will support small business owners in the highly impacted Northern Rivers Local Government Areas (LGAs) to cover operating costs to help them survive during the immediate recovery period.
1.3 Service NSW will deliver the Grant on behalf of the NSW and Commonwealth Governments.
1.4 By applying for the Grant, applicants agree:
a) 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
b) 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 Grant and compliance with the Grant requirements.
1.5 A public reporting channel has been established to allow people to report businesses not adhering to these Guidelines.
1.6 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. Available funding
2.1 Eligible small businesses will receive a one-off grant of $10,000.
2.2 Only one application can be submitted for a single ABN.
2.3 Only one application is permitted where there are multiple businesses under a single ABN.
3. How funding may be used
3.1 The Grant will support eligible small businesses to meet operating costs to help them survive during the immediate recovery period. These costs may include, but are not limited to:
a) salaries and wages
b) utilities and rent
c) government fees and charges (including local government rates)
d) financial, legal or other advice
e) marketing and communications
f) perishable goods, or
g) other business costs.
3.2 The Grant cannot be used on costs that you are entitled to make a claim for under an insurance policy.
3.3 Applicants must keep evidence for two years after the closing day for applications that Grant funds have been used to meet operating costs as outlined at 3.1.
4. Application process
4.1 Applications will open in April 2022 and close after 11:59pm on 30 September 2022.
4.2 Applicants will be required to complete an online application form through the Service NSW website. The evidence requirements are outlined in section 6.
5. Eligibility criteria
5.1 Businesses impacted by flooding events will be eligible if they:
a) have an active Australian Business Number (ABN) and were physically located and operating in a highly impacted Northern Rivers LGA on 1 January 2021
b) derived at least $75,000 in GST turnover in the year ended 30 June 2021 or 30 June 2020 from a business physically located in one of the seven highly impacted Northern Rivers LGAs (see Attachment A)
c) had an aggregated annual turnover of between $75,000 and $10 million (inclusive) for the year ended 30 June 2021 or 30 June 2020
d) experienced a decline in turnover of 40 per cent or more during the entire month of March 2022, compared to the entire month of March 2021 or March 2020 due to the impacts of flooding, and
e) intend to continue operating and or re-establish operations within the highly impacted Northern Rivers LGAs.
5.2 For the purpose of 5.1, the impacts of flooding may include, for example, reduced consumer demand, labour shortages and supply chain disruptions.
5.3 Businesses that have experienced a decline in turnover for reasons other than flooding, such as seasonal variations, COVID-19 or have closed for holidays or renovations, are ineligible.
5.4 A list of highly impacted Northern Rivers LGAs is at Attachment A.
5.5 Businesses that receive the following grants are not eligible for the $10,000 Small Business Northern Flood Grant:
5.5.1 February and March 2022 Storm and Flood Disaster Recovery Small Business Grant
5.5.2 Northern Rivers Medium-Sized Business Grant
5.5.3 $75,000 Special Disaster Grant Primary Producer for the February 2022 NSW floods
5.5.4 $25,000 Rural Landholders Grant for the February 2022 NSW floods.
5.6 For non-employing businesses, the business receiving the Grant 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 business, only one of the businesses (with whom that individual is associated) may claim the Grant.
5.7 Entities deriving more than 50 per cent of their earnings from passive income (e.g. rents, interest, or dividends) are ineligible, as are government agencies, local governments, banks and universities. A full list of ineligible businesses is at Attachment B.
5.8 Businesses that cannot meet the eligibility criteria, including businesses that commenced after 1 January 2021, or businesses for whom turnover in March 2021 or March 2020 was not representative of their usual turnover, may still be eligible if they can demonstrate a turnover equivalent to between $75,000 and $10 million, and a minimum 40 per cent decline in turnover using an alternate comparison period. Further information is provided in Attachment C.
6. Evidence in support of eligibility
6.1 Eligible businesses applying for the $10,000 Small Business Northern Flood Grant are required to:
a) submit an Australian Income Tax Return or other documentation to demonstrate the business had an aggregated annual turnover of between $75,000 and $10 million (inclusive) for the year ended 30 June 2020 or 30 June 2021 (whichever represents the financial year for the Australian Tax Return most recently lodged with the ATO);
i. businesses that have a substituted accounting period (SAP) (i.e. do not have an income tax year end of 30 June), can provide the business’ most recently lodged Australian Income Tax Return for the period that substitutes for the 2020 or 2021 financial year;
ii. businesses that have received a determination from the Australian Taxation Office relating to ‘control’ may submit that determination as evidence of entities that are connected with the business for the purposes of determining their aggregated annual turnover;
iii. registered charities that do not submit a tax return may submit other documentation.
b) declare that the business derived at least $75,000 in turnover from a business that is physically located and operating in one of the seven highly impacted Northern Rivers LGAs (see Attachment A) in the same year as the Australian Income Tax Return submitted to demonstrate aggregated annual turnover.
c) submit evidence through a letter from a qualified accountant, registered tax agent or registered BAS agent that they experienced a decline in turnover of 40 per cent or more due to the 2022 flooding events during the entire month of March 2022, compared to the same period in 2020 or 2021;
d) lodge other supporting documents as required to demonstrate that they meet the eligibility criteria.
6.2 The letter from a qualified accountant or tax professional to show decline in turnover must be from 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).
6.3 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 letter from a qualified accountant or tax professional to verify their decline in turnover, they should contact Service NSW on 13 77 88.
6.4 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.
6.5 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.
6.6 Businesses physically located and operating in a highly impacted Northern Rivers LGA with their ABN registered business address outside those LGAs will be able to apply if they can provide evidence their business was physically located and operating in a highly impacted Northern Rivers LGA on 1 January 2021 and meets all other eligibility criteria. 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.
6.7 There are several circumstances where a business may not meet the eligibility criteria and supporting evidence requirements but may still be eligible for the Grant. 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.
6.8 Alternative rules for these businesses are provided at Attachment C.
6.9 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 $10 million (inclusive) is derived through the trust. The entity operating the business is eligible for the Grant, not other entities that are receiving passive income from the business.
6.10 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.
6.11 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.
6.12 Businesses requiring assistance with their online application can contact Service NSW on 13 77 88.
Aggregated Annual Turnover: means aggregated turnover as defined in section 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 that are recovered in the ordinary course of business should be included. For the avoidance of doubt, the ATO aggregation rules still apply. This means grants that would not have had the character of business income, for example JobKeeper payments, are not included.
For not-for-profit organisations that are not registered charities, gifts should be excluded and Government grants included when calculating aggregated annual turnover. For the avoidance of doubt, the ATO aggregation rules still apply. This means grants that would not have had the character of business income, for example JobKeeper payments, are not included.
Applicant/s: is someone named as an associate or contact on the Australian Business Register.
Business: an individual, partnership, company or trust that is carrying on a business with an ABN.
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 – 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).
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.
Highly impacted Northern Rivers LGA: any Local Government Area listed in Attachment A.
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.
Qualified accountant, registered tax agent or registered BAS agent means a person who is a:
- qualified accountant as defined in the Corporations Act 2001;
- registered tax agent as defined under the Tax Agent Services Act 2009; or
- registered BAS agent as defined under the Tax Agent Services Act 2009.
Registered charity means an entity that is registered with the Australian Charities and Not-for-profits Commission (ACNC).
Attachment A: List of eligible Local Government Areas
To be eligible for the Small Business Northern Flood Grant, a business must be physically located and operating in one of the seven highly impacted Northern Rivers LGAs:
- Clarence Valley
- Richmond Valley
- Tweed Shire.
Attachment B: Ineligible businesses
A business is not eligible for the Small Business Northern Flood Grant 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 (Cth))
- 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 28 February 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 (Cth) 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)
- the business receives any of the following government grants or payments:
- the $50,000 February and March 2022 Storm and Flood Disaster Recovery Small Business Grant
- February and March 2022 Storm and Flood Disaster Recovery Medium Business Grant
- the $75,000 Special Disaster Grant – NSW Severe Weather & Flooding for February 2022 onwards (primary producer grants)
- the $25,000 Rural Landholder Grant – NSW Severe Weather & Flooding – February 2022 onwards (landholders and oyster farmers).
Attachment C: Alternative rules for businesses that do not meet standard eligibility criteria for the Small Business Northern Flood Grant
|Alternative circumstances||How to demonstrate aggregated annual turnover||How to demonstrate decline in turnover|
1. Businesses that commenced after January 2021
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 Grant must show the equivalent of between $75,000 and $10 million (inclusive) in aggregated annual turnover.
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:
Where a business does not have the evidence outlined above (for example, because the business started after 1 January 2022, or the business does not submit a BAS), the following may be provided as evidence of annual turnover:
Businesses must show a decline in turnover in March 2022 due to the impacts of the floods compared to the alternate comparison periods outlined below.
For businesses not operating on 1 January 2021:
For businesses that have been impacted by acquisition, disposal, or restructure:
For sole traders or small partnerships impacted by sickness, injury or leave:
4. Businesses impacted by natural disasters (e.g. drought, bushfire, flood but not including COVID-19) that are unable to use any of the comparison periods in 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 the flooding events in March 2022, compared to the same period 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 March 2022 and in the relevant comparison period 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 period as outlined in the guidelines.