A summary of the Government assistance for small business is summarised below:
Boosting Cash Flow for Employers
- Employers will receive a refund of up to 100% on PAYG withheld on wages paid in the January-March and April-June quarters this year
Eg. If you have paid wages of $100,000 and are ordinarily required to withhold $30,000
in tax, you’ll receive a full refund of that amount
- The minimum payment will be $10,000 and the maximum will be $50,000, processed as a credit in your normal BAS from 28th April;
- A second payment will then be processed in the July-October period, matching the payments above;
- The maximum you can receive under both payments combined is $100,000;
- For monthly wage lodgers the benefit will be three times the rate (300%) in the March 2020 activity statement.
PLEASE NOTE YOU MUST HAVE BEEN REGISTERED FOR PAYG WITHHOLDING AT 12TH MARCH 2020 TO ACCESS ABOVE CONCESSION.
Increasing the Instant Asset Write-Off
- Any business assets purchased after 12 March 2020 and before 30 June 2020, up to $150,000 can be claimed as an instant tax deduction against other business income.
Supporting Apprentices and Trainees
- Businesses with less than 20 full time employees can apply for a wage subsidy up to 50% of the apprentice or trainee’s wage, for 9 months between 1 January and 30 September 2020;
- The maximum payment is $21,000 (or $7,000 per quarter).
Temporary Early Release of Superannuation
- Existing financial hardship provisions will be relaxed, allowing people to access up to $10,000 before 30 June 2020 and a further $10,000 in the 2021 financial year;
- These payments are tax-free and will apply to business sole traders whose income or hours have reduced by 20% or more as a result of COVID-19;
- Application is made through the ATO, via a streamlined declaration process and reduced paperwork.
Deferral of Loan Repayments
- The Australian Banking Association have announced that lenders will defer repayments on all business loans for a period of 6 months;
- The assistance will be extended to any small business (defined as those owing less than $3 million) and impacted by COVID-19;
- The Government has also announced it will step in to guarantee unsecured business loans up to $250,000 over a maximum 3-year term.
This will enhance lenders willingness and ability to provide credit.
We have strong relationships and work closely with selected finance brokers therefore if you are in need of cash flow solutions or short-term loans please contact our office.
Temporary Relief for Financially Distressed Businesses
- The Government is temporarily increasing the threshold at which creditors can issue a statutory demand on a company, as well as the time frame in which a company must respond;
- This part of the package also includes temporary relief (via an amendment to the Corporations Act) for directors for any personal liability for trading while insolvent.