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Victorian Rent Relief Regulations Extended for 2022

by Chris Drayton and Celine Truong
10 February 2022
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The Victorian Government has announced extended support for Commercial Tenants as a result of the ongoing effects of the COVID-19 pandemic.

Whilst Rent Relief and Rent Freezes were due to end on 15 January 2022 (read our original detailed article here), the Commercial Tenancy Relief Scheme Regulations 2022 (Vic) (2022 Regulations) came into force on 1 February 2022, retrospectively continuing the rent relief scheme from 16 January 2022 until 15 March 2022 (Protection Period).

Whilst much of the former regulations are mirrored in the 2022 Regulations, there are important changes to the threshold for claiming rent relief and the turnover comparison test period.

Changes to the Eligibility Criteria

  • The 2022 Regulations have modified the eligibility criteria to leases or licences that are in effect on 16 January 2022 (previously 28 July 2021). 
     
  • Further, the 2022 Regulations now provide that only businesses that fall into the definition of “small entity” are eligible.
    • Definition of “Small Entity” - A small entity is defined as being a business whose turnover for the financial year ending 30 June 2021 is less than $10 million. Businesses that are not Small Entities are not eligible for further rent relief from 16 January 2022.
       
  • For the new Protection Period, there is no mandatory reassessment of rent relief required.
     
  • All other eligibility requirements for leases remain unchanged and can be referred to in our previous article.

Turnover Comparison Period

There is no change in the decline in turnover test (being 30% or more) to be eligible for rent relief in the Protection Period. However, the 2022 Regulations mandate that the period for comparison for turnover to be January 2022, compared with January 2020 (previously comparison period was to 2019). 

  • Note where a business ceased trading in January for more than a week, tenants are able to use December 2021 compared to January 2020 as the comparison period, so long as trading had resumed at the premises by 16 January 2022.
     
  • Also where there is insufficient turnover data available for comparison, the existing alternative turnover calculations are applied, as contained in the 2022 Regulations. 

Repayment of Deferred Rent

Finally, the 2022 Regulations push back the date for repayment of deferred rent made under previous regulations. Tenants are not required to pay back deferred rent until 16 March 2022 (previously 15 January 2022).