Cashflow crunch on the horizon?
The Government is offering small business loans of up to $100,000, which will be interest-free for 12 months. This is a fantastic opportunity to use an interest-free loan to help pay staff, cover the rent or for any other core business operating costs.
How much is available?
The amount you can borrow depends on how many full-time employees you have. The base loan is $10,000 and for every staff member you can borrow an additional $1,800.
How does repayment work?
The loan is interest-free if repaid within one year.
No repayments are required for the first two years.
After one year, 3% interest will be charged.
The maximum term is five years.
Is your business eligible for the loan?
To meet the criteria for the loan, your business must be viable. Inland Revenue will want to see your end-of-year accounts from the most recent financial year which ended in March.
You will also need to make a declaration that your business is viable and that you’ll use the money for core operating costs. You can’t use the funds as personal drawings or to pay dividends. You will need to enter into a binding loan contract.
How can you apply?
Applications will go through inland Revenue. Applications can be filed from May 12, for one month only. If you want to apply, call us when you get a chance and we can apply on your behalf.
Don’t forget there are also other options to help with your cashflow, outlined here. We’re here to help and we can talk you through which options could be right for your business.