Many businesses, especially primary producers, are not expected to survive the recent Queensland flood crisis, according to Brisbane Accountancy firm, elliotts.
Managing Partner of elliotts, Matthew Schlyder, said even those businesses that had their commercial premises and stock sufficiently insured for flood are vulnerable and unlikely to survive the next few months.
“Many businesses fail to insure themselves for loss of income due to natural disaster,” he said.
“Countless other businesses that may not have been directly affected by the flood will still find their revenue slump, because their flood affected customer base is struggling financially.”
For those businesses that were affected over recent weeks, Mr Schlyder said many business are not aware that their clean up, repair and restoration expenditure is mostly tax deductible.
“I would also like to notify businesses affected by the floods of the ATO’s automatic deferral of the lodgement and payment date for December monthly activity statements, originally due 21 January 2011 to 21 February 2011.”
Mr Schlyder said that one of the hardest hit sectors in Queensland is that of primary producers.
“For rural businesses that were affected, the Queensland Rural Adjustment Authority (QRAA) are offering non-repayable grants of up to $25,000 to assist primary producers in re-establishing their enterprises and will contribute to clean up, repair and restoration expenditure,” he said.
“Small businesses and primary producers within the listed flood disaster areas are eligible, though the grants do not compensate for loss of income.”
Furthermore, Mr Schlyder said a large percentage of businesses operating in the rural sectors are expected to take advantage of loans offered by The Queensland Rural Adjustment Authority (QRAA) of up to $250,000 with an interest rate of 4%; payable over seven years.
Mr Schlyder urged flood affected businesses to consult with their accountant before taking stock of damages, conducting repairs and purchasing new plant and equipment, to ensure they are doing so in the most tax effective way.
“This is also the time for all businesses to ensure they are adequately protected for natural disasters and thereby guarantee their survival.”