Keep up to date with Poole Group – Government Stimulus – Current information as at 23 March 2020
On Sunday 22nd March 2020, the Commonwealth Government released the second stage of its economic plan to cushion the impact of COVID-19 on the economy and provide support to businesses and individuals. This second-stage builds on the measures included in the first-stage and includes:
- Assistance for businesses to keep people in a job;
- Regulatory protection and financial support for businesses to stay in business; and
- Support for households including casuals, sole-traders, retirees and those on income support
The measures are to be legislated this week, which will provide further clarification.
Commonwealth Government assistance for businesses:
- Boosting cash flow for employers:
There is up to $100,000 for eligible small and medium businesses, and not-for-profits (including charities) that employ people. Under the second-stage package, employers will receive a payment equal to 100% of their salary and wages withheld (up from 50% in the first-stage package), with the maximum payment being increased from $25,000 to $50,000. An additional payment is also being made from 28 July 2020 with eligible entities receiving equal to the total ‘Boosting Cash Flow for Employers’ payments they have received. This means eligible entities will receive at least $20,000 up to a total of $100,000 under both payments.
The Cash flow boost is a tax free payment to employers automatically calculated by the Australian Taxation Office (ATO). There are no new forms required. Payments will be delivered by the ATO as an automatic credit in the activity statement system from 28 April 2020 upon employers lodging eligible upcoming activity statements. The payments will only be available to active eligible employers registered prior to 12 March 2020.
- Increasing the instant asset write-off
The Government has increased the instant asset write off threshold from $30,000 to $150,000 for businesses with aggregated annual turnover of less than $500 million (up from $50 million) until 30 June 2020.
- Backing business investment
There is a time-limited 15 month investment incentive (through to 30 June 2021) for businesses by accelerating depreciation deductions. Businesses with a turnover of less than $500 million will be able to deduct an additional 50% of the asset cost in the year of purchase.
- Supporting apprentices and trainees
Eligible employers can apply for a wage subsidy of 50% of the apprentice’s or trainee’s wage for up to 9 months from 1 January 2020 to 30 September 2020.
- Coronavirus SME Guarantee Scheme
The Government will guarantee up to 50% of new loans issued by eligible lenders to SMEs, providing up to $20 billion. The Government’s support will enhance lenders’ willingness and ability to provide credit to SMEs with the Scheme able to support $40 billion of lending to SMEs.
The Government is temporarily increasing the threshold at which creditors can issue a statutory demand on a company and the time companies have to response to statutory demands they receive. The package also includes temporary relief fro directors from any personal liability for trading while insolvent.
Queensland Government assistance for businesses:
- 12-month Interest Free Government Loans
The Queensland Government will create a new $500 million concessional loan facility to support businesses in keeping Queenslanders in work. This facility will comprise loans of up to $250,000 with an initial 12-month interest free period.
The Queensland Rural and Industry Development Authority (QRIDA) is responsible for the administration of these concessional loans and is currently taking expressions of interest in the lead up to rolling out these loans as soon as possible. Please visit the following link to register your interest.
- Deferring payroll tax
The State Government has also extended the coronavirus payroll tax deferral to all businesses across the state. If your business has been affected by the coronavirus, you may be able to apply for a relief package to defer paying payroll tax returns until 31 July 2020. Please visit the following link for more information and to apply. https://www.business.qld.gov.au/running-business/employing/payroll-tax/lodging/coronavirus-tax-relief
Commonwealth Government Assistance for individuals:
- Coronavirus supplement
The Government is temporarily expanding eligibility to income support payments and establishing a new, time-limited Coronavirus supplement to be paid at a rate of $550 per fortnight. This payment will be paid on top of payments already being received and will be paid to both existing and new recipients of the JobSeeker Payment, Youth Allowance jobseeker, Parenting Payment, Farm Household Allowance and Special Benefit.
- Payments to support households
The Government is providing two separate $750 payments to social security, veteran and other income support recipients and eligible concession card holders. The first payment will be made from 31 March 2020 and the second payment will be made from 13 July 2020.
- Early release of superannuation
The Government will allow individuals in financial stress as a result of corona virus to access up to $10,000 of their superannuation in 2019/20 and a further $10,000 in 2020/21.
Eligible individuals will be able to apply online through myGov before 1 July 2020. These amounts will be tax free and the money withdrawn will not affect Centrelink or Veterans’ Affairs payments.
- Temporary reduction in superannuation minimum drawdown rates
The Government is temporarily reducing superannuation minimum drawdown requirements for account based pensions and similar products by 50% for 2019/20 and 2020/21. This measure will benefit retirees by providing them with more flexibility as to how they manage their superannuation assets
- Reduction in social security deeming rates
As of 1 May 2020, the lower deeming rate will be 0.25% ad the upper deeming rate will be 2.25%. This change will benefit income support recipients and Age Pensioners.
Commonwealth Government Support – Businesses: https://treasury.gov.au/coronavirus/businesses
Commonwealth Government Support – Individuals :https://treasury.gov.au/coronavirus/households
Having been in the tech industry for over 14 years, Angie has seen all forms of technology evolve exponentially. Angie is part of Poole Group's Automation Projects team, developing their internal system to automate workflow and helping small businesses to implement Xero Apps.