How to recover your business after a natural disaster: a week-by-week money plan

The first days after a flood, fire or cyclone are about people and safety. The money questions come second, but they come fast: the insurer wants a claim number, the landlord wants rent, the ATO wants a BAS, and staff want to know if they’ll be paid.

The useful thing to know is that the order you tackle those questions in matters. This guide lays out a plan by time period, because a business rebuilds in stages, and what you need on day three is not what you need in month three.

What should you do in the first 72 hours?

Safety first: people, then premises. After that, the goal is to protect your position, not to fix anything.

• Photograph and film everything before clearing up. Stock, equipment, fixtures, water lines, damaged records. Include wide shots and close-ups, with the date. Insurers and grant programs ask for evidence.
• Open a claim. Call your insurer, get a claim number and ask what you can throw out, repair or replace without losing cover. Ask specifically whether you hold business interruption cover and what the waiting period is.
• Keep every receipt. Emergency hire, generators, accommodation, cleaning and temporary stock are often claimable, and certainly worth trying to claim.
• Save your records. If paperwork was lost, accountants, the bank and the ATO can all supply copies, so list what you need.
• Tell your key people. Landlord, bank, biggest customers and biggest suppliers. A short, clear message that you’ve been hit and will update them by a set date goes a long way.

Don’t sign anything for a repair quote, a settlement offer or a loan that same day, however tempting. A rushed contract in week one is the most common regret we hear.

What help does the ATO offer?

Ring the ATO’s emergency support line (1800 806 218) as early as you can, or ask your tax agent to. According to the ATO, depending on circumstances it can:

• defer lodgement dates so you can lodge without a failure-to-lodge penalty;
• set up a payment plan suited to what you can afford;
• consider remitting penalties or interest accrued while you were affected.

There’s one trap. For earlier disaster events, a deferred BAS lodgement date did not automatically move the payment due date, and the general interest charge still applied from the original date unless the ATO remitted it. So when you get a deferral, ask the next question as well: “Does the payment date move, and can interest be remitted for this period?”

For past events the ATO has also applied automatic deferrals for businesses in listed postcodes without an application. Check the ATO’s disaster page for your postcode rather than assuming. Our guide to ATO payment plans and how to talk to the ATO about a debt explain how those conversations go.

What grants and government help exist?

Federal and state governments share the cost of recovery through the Disaster Recovery Funding Arrangements. These are activated for a specific event and area, and what you get differs by state: some events trigger small business grants, some trigger concessional loans, some neither.

Practical steps:

1. Find out whether your local government area has been declared for your event.
2. Visit your state’s small business or reconstruction agency page, or business.gov.au’s disaster pages, for what’s open now.
3. Check the closing date. Disaster grants often have tight windows, and the application usually wants photos, invoices and proof of the business address.

Your accountant is also a good source: they often know what’s been activated before you read about it.

What are the money stages after the first week?

Stage	Main question	Typical moves
Weeks 1 to 4	Can we survive until the claim pays?	Insurance claim, ATO deferral, grants, rent and lender conversations
Months 2 to 3	Can we trade in some form?	Temporary premises, hired equipment, partial reopening, staged repairs
Months 4 to 12	Can we rebuild and refill the buffer?	Replace equipment, restock, borrow for the gap between claim payments, rebuild reserves

Most businesses are tested in the second stage, not the first. Adrenaline, community help and insurance advances carry you through the first month. Then payroll lands while the claim is still being assessed.

When does finance make sense?

Finance is a bridge, not a repair. It makes sense when you have a reasonably certain amount coming (an insurance payout, a grant, a customer who’ll resume paying) and a gap before it arrives.

Your bank first. Banks are often generous to existing customers after an event, with repayment holidays, restructured terms or a temporary limit increase. Ask what they offer before anyone else, and keep the conversation honest about timing.

If the bank can’t help, the usual options are:

• A short-term loan to bridge payroll and supplier costs. Our situation page on business loans after natural disasters covers what lenders look at.
• A loan secured on property you own, if the property itself is safe to lend against. A damaged building complicates valuation, so expect an insurer’s report to be requested.
• Equipment finance, once you know what you can replace. Wait for the insurer’s decision on repair versus replace before you sign.

For borrowing while a claim is open, the page on loans while an insurance claim is pending explains what lenders want to see. If you’d like to tell us where yours stands, send a quick enquiry.

Example: a regional workshop after a flood

This is an illustrative scenario. A four-person fabrication workshop in a regional town is inundated overnight. Stock and two welders are ruined, and the premises will be unusable for about eight weeks.

On day one the owner photographs the damage and opens a claim. On day two, the accountant calls the ATO. A BAS due the following week gets a deferral, and the accountant asks about interest on any payment already overdue. The owner tells the landlord the premises are unusable and asks about a rent adjustment for the period.

In week three the claim for equipment is accepted but not yet paid, and the business interruption cover has a waiting period. The owner needs money for payroll and to hire welders so the largest customer’s contract isn’t lost. A bank overdraft increase is declined while the premises are out of action. A short bridging loan, sized at 60 per cent of the assessed equipment claim, covers payroll and hire for ten weeks and is repaid from the insurer’s payment.

The owner chose 60 per cent on purpose: if the claim came in lower than expected, the loan would still be covered.

What mistakes cost the most?

• Throwing away evidence. Photograph first.
• Borrowing against the full claim figure. Claims can be reduced or delayed, so leave margin.
• Missing the grant window. Diarise closing dates on day one.
• Letting the BAS and super fall behind. Lodge on time and talk to the ATO instead of going quiet.
• Going it alone. Isolation is a bigger risk than most owners admit. If you’re running on empty, read mental health and money stress for business owners.

If the damage is severe enough that you’re questioning reopening at all, work through closing a business with debts before deciding, so you know every option.

Planning ahead for the next one

If you’re reading this before a disaster, the best protection is cash. A buffer that covers a few weeks of fixed costs gives you time for the insurer and the ATO to respond. See how to set up a cash buffer, and check that your policy covers business interruption, not just contents.

When the claim is slow and the bills aren’t

Owners in this position don’t need a sales pitch; they need to know whether there’s a way through the gap. Tell us where your claim and your bank stand and we’ll say honestly what might fit.

Enquiring takes around a minute and doesn’t involve a credit check, so asking won’t mark your credit file. We don’t pass your details to a long list of lenders. Instead, a real person reads your situation and phones you. Please fill in the form with accurate figures, including when you expect the insurer or any grant to pay, so the right option is the first one we put forward.

Tell us where the recovery stands →