Newsletter; Coronavirus
Cashflow assistance for employers
Small and medium businesses with a turnover of less than fifty million dollars will receive a credit based on their PAYG withholding liability.
Quarterly lodgers:
| Quarter | Amount | Timing | Minimum | Maximum |
| March | A credit equal to 100% of the PAYG withholding. | From April 28 (after the March BAS is lodged). | $10,000 | $50,000 |
| June | A credit equal to 50% of the initial payment received for March. | From July 28 (after the June BAS is lodged). | $5,000 | $25,000 |
| September | A credit equal to 50% of the initial payment received for March. | From October 28 (after the June BAS is lodged). | $5,000 | $25,000 |
Monthly lodgers:
| Month | Amount | Timing | Minimum | Maximum |
| March | A credit equal to 300% of the PAYG withholding | From April 21 (after the March BAS is lodged). | $10,000 | $50,000 |
| April | A credit equal to 100% of the PAYG withholding for April. | From May 21 (after the April IAS is lodged). | *$10,000 (including March) | *$50,000 (including March) |
| May | A credit equal to 100% of the PAYG withholding for May. | From June 21 (after the May IAS is lodged). | *$10,000 (including March & April) | *$50,000 (including March & April) |
| June (1) | A credit equal to 100% of the PAYG withholding for June. | From July 21 (after the June BAS is lodged). | *$10,000 (including March, April & May) | *$50,000 (including March, April & May) |
| June (2) | A credit equal to 25% of the initial payment received for March to May. | From July 21 (after the June BAS is lodged). | $2,500 | $12,500 |
| July | A credit equal to 25% of the initial payment received for March to May. | From August 21 (after the July IAS is lodged). | $2,500 | $12,500 |
| August | A credit equal to 25% of the initial payment received for March to May. | From September 21 (after the August IAS is lodged). | $2,500 | $12,500 |
| September | A credit equal to 25% of the initial payment received for March to May. | From October 21 (after the September BAS is lodged). | $2,500 | $12,500 |
Where the credit exceeds other activity statement obligations, it will result in a refund being paid.
Anyone with a fortnightly pay period that ends in April should do a weekly pay run in March to ensure that it is included in the March activity statement which will receive the higher credit and boost future payments.
Apprentices and trainees
From 1 January 2020 to 30 September 2020, employers with less than twenty full-time employees can apply for a wage subsidy of 50% of the apprentice/trainee’s wages paid. Employers will be reimbursed up to $21,000 per person ($7,000 per quarter).
Australian Taxation Office assistance
The ATO will assist businesses by:
- deferring payment dates for activity statements and income tax assessments for up to six months;
- remitting any interest and penalties incurred after 23 January 2020;
- allowing low interest payment plans.
Depreciation
From 12 March 2020 until 30 June 2020, small businesses with a turnover of less than fifty million dollars are able to immediately write off each eligible business asset they buy costing less than $150,000 per asset. Assets above this amount can depreciated using the simplified depreciation rules with a 57.5% deduction in the first year. If the balance of a small business pool is less than $150,000 on 30 June 2020, the whole balance can be claimed as a deduction.
From 1 July 2020, the instant asset write-off is due to revert to $1,000 and only be available to small business entities with a turnover under ten million.
From 12 March 2020 until 30 June 2021, medium businesses with a turnover of less than five hundred million dollars are able to immediately write off each eligible business asset they buy costing less than $150,000 per asset. Assets that are not depreciated using the simplified depreciation rules can claim 50% deduction in the first year.
Banking
The Government will provide a 50% guarantee for small and medium business loans with three year loan terms and six month repayment holidays (limited to $250,000).
Banks are providing discounted interest rates and six month repayment holidays on existing loans (with interest added to the loan balance).
NAB are waiving HICAPS and other merchant terminal fees for up to six months.
Sole trader support
If you are a sole trader and your business was suspended or there was a reduction in your turnover of 20% or more from 1 January, you can apply for an early release of super ($10,000 prior to 30 June 2020 and $10,000 from 1 July 2020).
Sole traders will be able to access the new Coronavirus supplement of $550 per fortnight for six months. Income testing will apply but if you’re earning less than $1,075 a fortnight, you will receive the full payment.
Sole traders may also be eligible for the Jobseeker Payment of $510.80 which will no longer be subject to an asset test during this period (and the energy Supplement of $7.90 per fortnight).
2020/2021 Budget
The Government has delayed the Budget until October 6.
