Commercial Tenancy Relief Scheme extended two more months
Lowe Lippmann Chartered Accountants
Commercial Tenancy Relief Scheme extended two more months
The Victorian Government recently announced the Commercial Tenancy Relief Scheme (CTRS) will be extended for another two months ending on 15 March 2022, after the CTRS was originally due to end on 15 January 2022.
This extension has been made to help support small business owners under financial pressure as Victoria continues to respond to the COVID-19 Omicron variant.
While full details of the new regulations for the extended scheme are yet to be released, however the Victorian Government has confirmed the following details will now apply, including:
- The extended scheme will apply to tenants with:
- an annual turnover of $10 million or less (which is down from the original $50 million threshold); and
- at least a 30% decline in turnover.
- The extended scheme will have retrospective operation from 16 January 2022, to ensure that tenants who were already receiving rent relief and remain eligible for relief should experience a gap in support.
- Landlords will be required to keep providing proportional rent relief in line with a reduction in turnover experienced by the tenant, with at least half of that rent relief offered by way of waiver of rent.
- Eligible commercial landlords who provide rent relief under the extended scheme should continue to be supported through the $20 million Commercial Landlord Hardship Fund.
- For tenants with existing agreements repayment of deferred rent, the repayment obligation will be paused until 15 March 2022, giving these businesses more time to repay deferred rent because of the extended scheme.
- The 'freeze' preventing landlords increasing the rent under the lease will continue.
- The eviction moratorium will also be extended, so eligible tenants cannot be evicted without undertaking mediation through the Victorian Small Business Commission (VSBC). While it still needs to be confirmed, tenants who have not yet sought rent relief may still be entitled to apply for CTRS relief, albeit for a limited time of two months.
Regulations for the Scheme will be made shortly and the
VSBC’s website and FAQs will be updated.
Please do not hesitate to contact your Lowe Lippmann Relationship Partner if you wish to discuss any of these matters further.
High Court decision and ATO statement on Bendel’s Case The High Court recently handed down its decision in Bendel’s Case, confirming that an unpaid present entitlement (or UPE) between a discretionary trust and a beneficiary company does not fall within the extended definition of a “loan” for Division 7A purposes. The Australian Taxation Office released a Decision Impact Statement in response to the High Court findings, concluding the High Court's reasoning makes it clear that where a beneficiary company is entitled to a share of trust income that remains unpaid (a UPE) and the company takes no positive actions to call for payment of the entitlement, this will not fall within the expanded definition of a "loan" for Division 7A purposes. This is in contradiction to the ATO’s historical position that treated UPEs as "loans".
Government's tax reform package The Government has recently legislated several of the tax reform measures announced in the 2026 Federal Budget (and in later media releases). These include, among other things: Replacing the CGT discount with cost base indexation and a 30% minimum tax on gains accruing from 1 July 2027 (including gains on pre-CGT assets); Increasing the small business turnover threshold for the 50% active asset reduction from $2 million to $10 million; Limiting negative gearing for residential property to new residential dwellings from 1 July 2027 (subject to transitional rules); and Introducing the Working Australians Tax Offset from 1 July 2027, and the $1,000 instant tax deduction for work-related expenses from 1 July 2026. After a round of consultation, the Government has also announced further proposed measures, broadly including (among others): A new targeted CGT discount for investors in innovative start-ups; Barring SMSFs from utilising future limited recourse borrowing arrangements ( LRBAs ) to acquire residential property; and Exempting income of discretionary testamentary trusts from the minimum tax proposed for trusts. We recently released a Tax Alert considering the legislation restricting SMSFFs using residential property LRBAs – to read click here . For full details of each of the 2026 Federal Budget announcements, please see our Federal Budget Tax Alert – to read click here .
Tax Alert - Legislation restricting SMSFs using residential property LRBAs has now passed Parliament
Legislation restricting SMSFs using residential property LRBAs has now passed Parliament The Treasury Laws Amendment (Tax Reform No 1) Bill 2026 ( the Reform No 1 Bill ) was passed by Parliament on Thursday 25 June 2026. Schedule 5 of the Reform No 1 Bill amends section 67A of the Superannuation Industry (Supervision) Act 1993 to restrict future limited recourse borrowing arrangements ( LRBAs ) on real property to investments in “business real property” (as defined in section 66 of the SIS Act). Residential property of any kind is excluded from the definition of “business real property” in section 66 of the SIS Act. We note this also excludes newly constructed residential property, which is a distinction at odds with recent exemptions being given to new-builds with other Budget Night tax changes relating to negative gearing and restricting the CGT 50% discount. Super funds are not generally allowed to borrow for investments, but there has been a concession allowing a self-managed super fund ( SMSF ) to borrow money to buy single assets like property, if their loans were set up in line with particular requirements, known as LRBAs. This change means an SMSF will not be able to borrow to buy residential property after the start date of these changes.
