COVID loan repayment deferral period coming to an end

In the next few weeks banks will start to call asking for payments to be resumed. What is the best approach?

After six months off, at the end of September, thousands of individuals and small business owners across Australia will resume paying back loans that were put on hold due to the economic downturn sparked by COVID-19.

A number of courses of action are open:

While interest only loans are not often recommended, in the scenario right now, you should assess your business position. These are unprecedented times. You could request to pay interest only now, then move onto full repayments at a later date.

The most prudent course of action is probably to extend the loan and pay off interest and some principal.

Looking to the future, most businesses will be hoping that by the middle of next year business life will have returned to close to normal – or perhaps a new normal but of course much remains uncertain.

Call in at your local TaxAssist Accountants if you need help or advice with your business and planning for the future.

Written by Terry Murphy

Last updated: 24th September 2020