Small business loan - 2 year interest free period ending
Applications for the IRD small business loan first opened mid May 2020.
The loan was a 5 year term, with the first 2 years interest-free with no repayments required, provided the loan is not in default.
For those taxpayers that received the IRD small business loan when it first came out in May 2020, the interest free 2-year period is about to end.
If taxpayers do not want to pay interest, they will need to repay the loan in full prior to the expiry of the 2 year period.
If full repayment is not made, IRD will begin charging interest at 3% from the first day of the third year of the loan period (after expiry of the 2 year interest free period).
Repayment requirements will also start at the end of this 2 year period, and IRD will write to taxpayers advising them of their monthly repayment amounts.
Please check your IRD correspondence and small business loan details in your IRD “myIR” account,
or contact your PKFD advisor if you want more information on how this impacts you or for a copy of the IRD letter issued.