Since the Australian Prime Minister Scott Morrison announced the Covid-19 moratorium on evictions, property managers and investors have had one single thought on their minds, what is this going to mean for rent arrears? Rent Arrears is probably the single biggest stress and cause for angst for property managers, business owners, and landlords, largely due to the spiraling effect the non-payment of rent means for everyone involved.

For Queensland, our worries have been alleviated somewhat, with the Government announcing new temporary legislation concerning the boundaries for the rental properties and the pandemic.

The good news is that a tenant now has to prove their financial hardship as a direct result of Covid-19 as the first criteria, the next criteria are that they have to show a 25% reduction in income or prove that their rent is costing them more than 30% of their income.

There are also several more forms specifically designed to assist with the financial hardship process, these are a Show Cause Form, a Form 18D Variation Agreement, and a Form 16B Mandatory Dispute Form.

The Show Cause form is designed for the tenants to prove their rent arrears are a result of Covid-19. This is to be sent to tenants at 7 days in arrears if you haven’t heard from them. They have 14 days to respond with evidence of financial hardship due to Covid-19. This form is a concern because it could mean tenants have up to 21 days before they could receive a breach notice extending the amount of time a landlord can potentially be without income.

The Form 18D Variation to Agreement is an overriding temporary agreement to the existing General Tenancy Agreement and outlines the terms of the new rental payment agreement negotiated between the tenant/s and the landlord.

While the Form 16B Mandatory Dispute resolution form is to be submitted if an agreement can’t be negotiated between a landlord and a tenant.

Helping genuine cases of Covid-19 related hardship should be an agency, owner, and property manager priority, and negotiating the terms of either a reduction or payment plan period should be fair, equitable, and reasonable. Your standard rent arrears procedure will need to be adjusted to take into consideration the new legislation and the abovementioned forms and issues surrounding them.


The main adjustment required due to the temporary legislation in Queensland is surrounding the new Show Cause form. This essentially allows for up to 21 days before a tenant can be breached, which is a long period for landlords to wait. Then it is another 7 days after the breach is served before a Notice to Leave is served, and again another 7 days is allowed, all up a landlord could be out of pocket approximately 35 days essentially over a month. To avoid this a focus needs to put back on chasing up rent arrears from 1 day behind in rent, it needs to be consistent and relentless to determine whether or not the arrears are Covid-19 related. Another consideration is the Landlord’s insurance policy, some of the steps you would normally follow to ensure their policy is valid, will need to be adjusted to ensure it stacks up even in a Covid-19 related situation.

Here is an example of how the Rent Arrears procedure could look:

  • 1 – 4 Days in arrears – Call to the Tenant – seeking instructions whether the rent arrears are due to Covid-19
  • If NO – Breach as normal at 8 days
  • If YES – Send through Hardship Application or Show Cause Form to the tenant


  • 5 – 7 Days in arrears – Try tenants contacts on the application form to seek a response from the tenant, request a welfare check. Ensure daily contact is initiated to seek advice from the tenant.
  • 7 Days in arrears – Send tenant Show Cause form
  • 14 Days in arrears – Issue normal breach notice

Expiry of Breach Notice – Automatic Notice to Leave issued

Expiry of Notice to Leave – Evicted from the property

The important issue to highlight here is that the Show Cause notice is only required if you don’t have any contact from the tenant. If you have confirmation from the tenant and they aren’t Covid-19 affected continue your normal Breach process, however, if the tenant is experiencing financial hardship due to Covid-19 then the process for negotiating an agreement with the tenant and landlord for a rent reduction or payment plan needs to be instigated. The Show Cause is essential to be sent to the tenants if they aren’t responding to your efforts for contact for the landlord insurance policy to be valid. 

Another essential element is to conduct your rent arrears follow up daily from day one, the sooner you get confirmation from the tenant the less loss of income an owner is likely to experience. Make sure any phone conversations you have with a tenant before the 7 days are put in writing confirming or denying whether Covid-19 is impacting their ability to pay rent or not. Typically rent arrears if fairly automated process these days, but it is time to go back to old school and pick up the phone and start the conversation concerning rental default as early as possible.

Once you have determined that Financial Hardship is a result of Coronavirus, you can start the next step in the process and that is negotiating a Rent Reduction. 



  • Show compassion and empathy for the tenant’s situation and understand the basics of what they are looking for ie Rent Reduction or Payment Plan
  • Listen, listen, listen this could be quite emotional and hard for some people to discuss, listen to what they have to say before sharing your information
  • There are two KEY Criteria they need to meet to be eligible for Financial Hardship due to Covid-19 before you go any further with negotiations
  •  They must prove financial hardship is directly related to Covid-19 (ie loss of employment, isolation due to having Covid-19 or a vulnerable person)
  •  They must prove a 25% loss of income or Rent is more than 30% of income
  • Advise them that the owner is in the same situation and Covid-19 is affecting every single one of us and we are all in this together
  • Advise that this is a negotiation and we have to work with their situation and the owners, who may still have a mortgage to pay and may have also lost their job
  • Outline the steps needed to take to get this agreement finalised ie complete the application and attach supporting documents, then an agreement needs to be drawn up and a form 18D signed
  • Advise the quicker they get information back to us the quicker we can get the new payment agreement arranged
  • Make sure you understand the new legislation and have the points handy to discuss with the tenants
  • Avoid conflict with the tenants send them directly to the Queensland Governments Covid-19 Hub or the RTA

  Direct them to any additional places they might be able to seek financial support


  • Understand the landlord you are going to be speaking with, are they financially astute or rely heavily on the rent for their mortgage payments, knowing who you are going to be speaking with first will help set the tone for the conversation ahead.
  • Prepare a list of potential questions this particular landlord is likely to ask and have your responses prepared to the best of your ability.
  • Know the new legislation, you need to be the expert, it is the only way the landlord will trust you.
  • Set the tone by asking how they are coping with the Covid-19 situation and get an understanding of their challenges in the current situation.
  • Share the tenant’s situation with them, direct and to the point (Even send them a copy of the tenants’ application for additional proof).
  • Address the Terms of the agreement the tenant is seeking but advise the landlord it is a negotiation.
  • Address the options with the Landlord:

                I. Allow Rent Reduction for a set period with no repayment

               II. Allow Rent Reduction for a set period with a repayment option – either payment plan or deduction from bond

               III. Allow payment plan for set amount and duration

  • Advise owner to check their financial options with Bank or Mortgage broker, can they reduce their repayments for a set period
  • Listen to owners concerns and wishes and work with them to be as fair as possible to both parties
  • Advise outcomes if a negotiation can’t be agreed upon; ie RTA Conciliation may take 2 weeks or more, then QCAT will be a few months or more, potentially months without any rental income at all
  • Offer time for the Landlord to think about it and look into their options
  • Direct the Landlord to the Queensland Government’s Covid-19 Hub

  • Assure the Landlord you have a secured procedure in place to ensure the terms of the agreement are monitored and followed up


Chasing rent arrears used to be an arduous task back in the archaic days of property management. With advances in technology, rent arrears have become a less challenging task making this a fairly streamlined process.

This process starts with ensuring your tenants are aware of your rent arrears policy from the onset of their relationship with your agency. Like a contract, it should be clearly outlined, explained, and signed as part of the documents you use when you sign up a new tenant to a property.  

Your rent arrears procedure should look something a little like this:

1 – 4 Days in arrears – SMS reminder to Tenant

5 – 7 Days in arrears – SMS reminder and a courtesy phone call to the tenant

8 Days in arrears – automatic Breach Notice sent

Expiry of Breach Notice – Automatic Notice to Leave issued

Expiry of Notice to Leave – Evicted from the property

How to avoid getting to the breach notice stage:

  • I can’t stress this tip enough, pick up the phone, and have a chat with the tenant. Like any debt collection call it is very easy to ignore an email or an SMS, but a lot harder to not provide an answer when you are talking to someone direct. This should be part of your procedure in the 1 to 7 days in arrears, especially if you notice a tenant who isn’t normally on your arrears list, find out what is going on.
  • Despite all the technology available now, communication is still key to managing debt and rent arrears, talking through their situation, the consequences, and setting a plan in place are crucial to avoid huge arrears lists.
  • Try and get your tenants two weeks in advance although not a legislative requirement.
  • Offer incentives to stay in front, like a competition to be two weeks in advance by a certain date and they go in the draw to win a prize. Christmas time is notorious for rent arrears, so offering a few Christmas hampers to tenants who are in front, is a way to reduce rent arrears at this time of year. We also request a small donation from our owners towards the prizes we offer the tenants. This might be some Christmas hampers or gift cards to a certain value.
  • Offer financial support options where a tenant might be able to get rent assistance or cash payments, this could be government or charitable organisations amongst others.
  • Give tenants a budgeting tool when they sign up with your agency.
  • Have the boundaries and consequences clearly set out at the onset of the tenancy, an agreement they have to sign outlining this is beneficial, i.e. your rent arrears policy.
  • If you can’t get hold of a tenant or they aren’t paying, refer to their application form and touch base with references or next of kin.
  • Payment plan – get them to commit to a payment plan, make them accountable for sticking to it by putting it in writing, and have a tracker to monitor payments. Have three strikes you’re out, policy if they default. Have a debt collection procedure in place to follow up, don’t just ignore the fact they have defaulted or they will keep doing it.
0439 895 808
A former sports journalist, Kylie Walker brings a wealth of communication and marketing skills to the team at iThink Property. The busy mother of four launched and developed the company’s rent roll and has organically grown the business with iThink Properties rental network now spanning Ipswich, greater Brisbane and Toowoomba.