Over the last week the Federal Government has released two stimulus packages to assist individuals and businesses in this time of uncertainty.

We have put together a summary to detail what government assistance is out there.

Individuals

• The government is expanding the eligibility to income support and establishing a new time-limited Coronavirus supplement to be paid at a rate of $550 per fortnight.

This payment is eligible to:

• Jobseeker Payment (and all payments progressively transitioning to JobSeeker Payment; those currently receiving Partner Allowance, Widow Allowance, Sickness Allowance and Wife Pension)

• Youth Allowance Jobseeker

• Parenting Payment (Partnered and Single)

• Farm Household Allowance

• Special Benefit recipients

Anyone who is eligible will receive the full $550 Coronavirus supplement per fortnight in addition to any other assistance they may qualify for, including rent assistance or the Family Tax Benefit A or B.

For the 6-month period that this Coronavirus supplement will be available the application process has been streamlined with only the income tests being necessary to determine eligibility. They have expanded the access of eligibility to employees who are stood down or lose their employment; sole traders; the self-employed; casual workers; and contract workers who meet the income tests as a result of the economic downturn due to the Coronavirus.

The Coronavirus supplement and expanded access for payments will commence from the 27th of April 2020.

For further information go to https://treasury.gov.au/sites/default/files/2020-03/Fact_sheet-Income_Support_for_Individuals.pdf

Household support

Two $750 stimulus payments will be paid to social security, veteran income support recipients and eligible concession card holders, except for those who are receiving an income support payment that is eligible to receive the Coronavirus supplement as mentioned above.

The first payment will be made automatically from the 31st of March 2020 and the second will be made from the 13th of July 2020.

Superannuation stimulus

There is also the option to take two tax free payments of up to at total of $20,000 out of your superannuation fund.

You may be eligible to access a payment of $10,000 tax free from your superannuation for the 2019-2020 year and a further $10,000 in the 2020-2021 financial year.

In order to access it you will need to apply online through your mygov and you will need to prove that you are in ‘financial stress’.

Eligibility:

• You are unemployed

• You are eligible to receive a jobseeker payment, youth allowance for jobseekers, parenting payment (which includes the single and partnered payments), special benefit or farm household allowance.

• On or after 1st of January 2020, either

  • you were made redundant

  • your working hours were reduced by 20% or more

  • if you are a sole trader, your business was suspended or there was a reduction in your turnover of 20% or more.

Applications for early release superannuation will be available from mid-April 2020

If you are a member of a self-managed superannuation fund separate arrangements will apply.

Small to Medium Sized Businesses (turnover under %50 million)

For sole traders and businesses who don’t employ people you are eligible for the following:

• The increased instant asset write-off (increased from $30,000 to $150,000

• The accelerated depreciation deduction arrangements which is a deduction of 50% of the cost of an eligible asset on installation. Does not apply to second-hand or assets or other capital works.

Applies to eligible assets acquired from 12th March 2020 and first used or installed by 30th June 2021

The ATO is also providing relief to tax obligations affected by the outbreak on a case by case basis. This may include:

• Remission of interest and penalties

• Payment deferrals for business activity statements, income tax, pay as you go instalments, fringe benefit tax and excise payments for up to six months. 

• Low interest payment plans

For businesses (including sole-traders) who employ people on wages you are eligible for the boosting cash flow stimulus.

• The payment will be delivered by the ATO in the March BAS lodgment from the 28th of April (the due date of the quarter).

• Businesses that withhold tax on their employees salary and wages will receive a payment equal to 100% of the amount withheld, up to the maximum of $50,000.

• Business that pay salary and wages, even if they are not required to withhold tax will receive a minimum payment of $10,000.

The payments will only be available to active eligible employers established prior to March 2020

There is an additional payment of up to $50,000 that will be available for businesses that continue to be active. This additional payment will be made from the 28th of July 2020. All payments are tax free, there will be no new forms and payments will flow automatically through the ATO.

Quarterly lodgers will be eligible to receive the payment for the quarters ending March 2020 and June 2020.

Monthly lodgers will be eligible to receive the payment for the March, April, May and June 2020 lodgements.

The minimum payment will be applied to the business’ first lodgement.

If you are an eligible business allow 14 days for the ATO to deliver the refund.

SME Guarantee Scheme

Under this scheme, the Government will guarantee 50% of new loans issued by eligible lenders to small to medium sized entities.

Eligible lenders will guarantee for loans with the following terms:

• Maximum total size of loans of $250,000 per borrower

• The loans will be up to 3 years with an initial 6 month repayment holiday

• The loans will be in the form of unsecured finance, meaning that borrowers will not have to provide an asset as security for the loan.

Loans will be subject to lenders’ credit assessment processes with the expectation that lenders will look through the cycle to sensible take into account the uncertainty of the current economic conditions.

The scheme will commence by early April 2020 and be availabe for new loans made by participating lenders until the 30th September 2020.

NT Government Jobs Rescue & Recovery Plan

Business Improvement Scheme

Any registered NT business is eligible to receive a grant of up to $20,000. This funding is for businesses to purchase goods and services to make permanent physical improvements to their premises that must help to improve the business operations and customer experience. The first $10,000 will be paid as a grant with no co-contribution. A further $10,000 will be available provided the business contributes $10,000 of their own.

Eligibility:

• A legal entity with an ABN as of the 30th of March 2020

• Is operating in the NT in either owned or leased premises

• Has a significant permanent presence in the NT

• Employs NT residents (this can be you if you are a sole trader)

If you are a business looking for work you must register online at https://business.nt.gov.au/recovery from Monday the 30th of March so they can be listed on the approved business and tradespeople list for those receiving the funding to select from.

Applications for the grant will be open on the 30th of March. To apply go to https://business.nt.gov.au/recovery/business-improvement-grant

Business Structural Adjustment Package

To assist businesses who need to physically adjust to the 100 person rule or establish or upgrade their online presence to adjust to changing behaviours of consumption. All businesses can apply but the Department will be focusing on the hospitality sector first (such as restaurants).

Immediate Works Grant

For incorporated non-for-profit and community organisations - including clubs - to undertake renovations and upgrades to their premises/facilities. Applicants can apply for grants of up to $50,000, which will then be matched dollar-for-dollar if the organisation also puts in their own $50,000.

Government Fees and Charges Freeze

The Government will freeze all indexation rises until July 2021 for utilities, motor vehicle registrations etc. This does not mean that you don’t need to pay your bills, they will still fall due as normal.

If you have any questions or require any further assistance, contact us on 89 810 222 or via email at administration@lcaccountants.au

We are here to help and support our clients through this uncertain time.