A COVID-19 'impacted tenant' is defined as a tenant in a household (meaning any tenants or other persons living together in the same residential premises) which has had a reduction or loss of work and/or income because of the pandemic AND as a result the weekly household income has been reduced by 25%.Your renting household needs to be able to demonstrate any 1 or more rent paying members of the household have:
- lost employment or income as a result of the impact of the COVID-19 pandemic, or
- had a reduction in work hours or income as a result of the impact of the COVID-19 pandemic, or
- had to stop working, or materially reduce the member’s work hours, because of – the member’s illness with COVID-19, or another member of the household’s illness with COVID-19, or the member’s carer responsibilities for a family member ill with COVID-19.
And as a result of the above factors the weekly household income for the household has been reduced by at least 25% compared to the weekly household income for the household before the occurrence of any of the matters
See also 'Eligibility' in Six month moratorium on residential tenancy evictions during COVID-19 (NSW Fair Trading website).
The 25% reduction in household income is assessed on income after tax, and is assessed on total household income – not just any one individual in the household. The ‘household’ is understood to be everyone living in the home contributing to rent, not just those listed on the tenancy agreement.
If you ARE a COVID-19 'impacted tenant'...
From 27 March 2021, if you are a COVID-19 'impacted tenant' and have arrears of rent or charges which accrued during the Moratorium Period, you will have new protections.
The protections are as follows:
A landlord must not serve you a notice of termination or apply to the NSW Civil and Administrative Tribunal (NCAT) for termination for arrears accrued during the Moratorium Period if —
(a) a repayment plan was agreed for the arrears, and
(b) you have complied with the repayment plan.
In practice, this means that your landlord cannot take you to the Tribunal for the arrears unless you have failed to pay 2 consecutive payments under the agreement. If you have missed two or more consecutive payments by the relevant deadline under the repayment plan then your landlord can only evict you if it is 'fair and reasonable' in the circumstances (see COVID-19 Guide: Eviction).
If you are an 'impacted tenant' and you have no repayment plan in place for arrears, then your landlord must not serve you with a notice of termation or apply to the Tribunal for termination for arrears accrued during the Moratorium Period UNLESS:
(a) Your landlord has participated in good faith in a formal arrears repayment negotiation process about a repayment plan for the arrears, and
(b) it is fair and reasonable in the circumstances
The first step when initiating negotiations for a repayment plan will involve demonstrating your eligibility as an 'impacted tenant'
To show your income has been reduced, you can provide pre-COVID-19 bank statements, letters from your employer or any other proof of income.
The Tribunal has a financial impact statement form which you can fill out carefully and attach any relevant material.
If you are a COVID-19 'impacted tenant' - this flowchart from NSW Fair Trading sets out the process for tenants and landlords under these new measures.
If you are NOT a COVID-19 'impacted tenant'...
Rent arrears and eviction
If you do not qualify as a COVID-19 'impacted tenant' – for example your household income is reduced by 20% and not the 25% as defined in the legislation – you may still ask the landlord to consider a repayment plan for arrears. If the landlord or agent ignores your request or won't enter into negotiations you may be able to access the NSW Fair Trading Dispute Resolution process.
While the restrictions against eviction for rent arrears outlined above will not apply, the Tribunal still has discretion about whether to proceed with rent arrears evictions. Each case will be assessed on its merits and will require the tenant to provide evidence of any additional hardship.