Commercial Tenant and Landlord Relief Update

Amendments and Extensions for Victoria

By: Worksmith

Following the Premier’s announcement in August, the Victorian Governor in Council has now published the amendments regarding the intention to extend and modify regulations applicable to rent relief for commercial tenancies. Affected landlords may be eligible for land tax relief and impacted tenants will be relieved to have ongoing rental relief. We’ve turned to the team at Shine Wing, who have done a brilliant job of explaining what these amendments mean.

Initially set to expire at the end of September 2020, the Regulations have now been extended until 31 December 2020. Accordingly, existing rent relief arrangements may carry on for a further three months and new rent relief agreements may be reached after September 2020. Additionally as outlined below, tenants may apply to have existing rent relief agreements revised.

When applying for rent relief, tenants will now need to provide the following information in addition to the existing requirements:

  • The statement setting out their decline in turnover, expressed in a percentage and calculated consistently with the actual decline in turnover calculated for their most recent JobKeeper turnover test period

  • The receipt number issued by the ATO when electing to participate in JobKeeper

  • A copy of the tenant's most recent notice under the JobKeeper rules to the Commissioner of Taxation

Evidence of the stated decline in turnover which must include at least one of four documents:

  1. Extract from accounting records, or

  2. Business Activity Statements, or

  3. Bank statements; or

  4. A statement prepared by an accountant.

  • Landlords must now offer rent relief for the period starting on the date of the tenant’s request for relief and ending on 31 December.

  • Rent relief now must be at least proportional to the decline in the tenant’s turnover associated with the premises, as per the statement now required to be made by the tenant at the time of applying for relief.

  • Where rent is normally charged inclusive of outgoings, proportional rent relief must apply to the total amount including outgoings.

  • Tenants who have received rent relief that is not proportional to their reduction in turnover, prior to the amendments coming into force, may make a further request to the landlord for relief.

  • Similarly, tenants who have received rent relief that was not for the entire period starting on the date of their application and ending on 31 December 2020, may make a further request to the landlord for relief.

  • Payment of deferred rent cannot be requested until 31 December 2020.

  • Certain provisions continue to apply, even where a tenant who has received rent relief ceases to be eligible for JobKeeper.

For a detailed insight into how these amended regulations may apply to your business, the team at Shine Wing have done an excellent job of putting together a detailed summary, here.

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