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Your rights and responsibilities

Commercial (including retail) tenants and landlords

Support for tenants and landlords in reaching rent relief agreements

The Victorian Small Business Commission (VSBC) is here to support commercial tenants and landlords who are experiencing financial hardship as a result of coronavirus (COVID-19).

Although commercial tenants are no longer entitled by law to rent relief now that the Victorian Government’s Commercial Tenancy Relief Scheme (the Scheme) has ended, we are still providing free and impartial mediation to help resolve commercial rent relief disputes in response to the pandemic.

We are providing guidance in negotiating rent relief in good faith and reaching a fair agreement after 28 March 2021. Where an agreement can’t be reached, tenants and landlords can apply for mediation to help resolve their dispute, using our retail leases dispute form.

We are also providing mediation under the Scheme where the dispute relates to a tenant’s written rent relief request that was made:

For rent relief disputes before 28 March 2021 where the Scheme doesn’t apply and parties are wanting help to resolve the matter, either the tenant or landlord can apply for mediation using our retail leases dispute form.

For more information, see our:

Tenants who are having difficulty paying rent

Commercial tenants who are having difficulty paying monthly and/or deferred rent are encouraged to take the following steps:

  • Review your finances and keep paying what rent you can afford.
  • Contact an accountant, a business advisor or mentor, or a financial counsellor for advice as soon as you can ­– the Small Business Mentoring Service provides access to experienced mentors, Partners in Wellbeing provides access to free qualified financial counsellors who can help in negotiating affordable repayment plans and CPA Australia offers a helpful tool for finding a certified practising accountant in Victoria.
  • Try to negotiate a new agreement on rent with your landlord that will apply after 28 March 2021 by:
    • talking with them about your situation, what rent you can afford to pay and the rent relief you are requesting (how much and for how long)
    • considering supplying documents showing your fall in turnover for the leased premises (e.g. extracts from your accounting records, your BASs, bank statements that relate to your account or a statement prepared by a practising accountant) to support your request.
  • Look after yourself – if you are feeling stressed, worried or overwhelmed, call the Partners in Wellbeing helpline on 1300 375 330 (Monday to Friday 9am – 10pm, Saturday to Sunday 9am – 5pm) for mental health support and financial counselling at no cost.

Negotiating in good faith and documenting the agreement

Where a tenant is having difficulty paying rent, we encourage the landlord and tenant to negotiate in good faith. This means:

  • communicating with each other openly
  • being transparent
  • having discussions honestly and fairly with the genuine aim of reaching an agreement
  • providing sufficient and accurate information within the context of negotiations.

It’s important to then document what is agreed to in writing – you can do this as a variation of the lease but this isn’t necessary if you have a written agreement for rent relief.

Landlords and tenants who can’t reach an agreement

If a landlord or tenant can’t reach an agreement or get a response from the other party, they can use our retail leases dispute form to apply for help in having negotiations and reaching a fair agreement at mediation.

How can landlords access land tax relief?

Landlords who have provided rent relief to their tenant might be eligible for land tax relief as part of the Victorian Government’s 2021 measures. For more information or to apply, visit the State Revenue Office’s website.

Can I end my lease early?

A lease is a legally binding agreement. Some tenants who are experiencing a downturn in trade might be wanting to end their lease early. We encourage tenants in this situation to communicate with their landlord as early as possible to discuss their position and alternative options. Find out more.

Should I close my small business?

If you’re finding that your small business is no longer viable, you might need to consider closing your business. CPA Australia offers practical guidance on warning signs your business might be in trouble – both early on and at the critical stage – and actions you can take. Find out more.

General retail leasing information – what tenants and landlords need to know

As a retail tenant or landlord, it’s important to understand:

 

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