In an attempt to deal with the impact of the coronavirus on the Australian economy, the government announced a $17.6 billion stimulus package.
Please note the below measures are subject to the relevant legislation passing through parliament. At this stage, parliament is not scheduled to resume until the 23rd of March.
What’s in it for you?
A stimulus payment:
- a one-off $750 payment all social security, veteran and other income support recipients and eligible concession card holders. This includes those on Newstart, those who have commonwealthseniors health cards, and families receiving family tax benefits.
- The payment will be tax-free and will not count as income for social security, farm household allowance and veteran payments.
What’s in it for your business?A cash-flow boost:
- Eligible businesses that withhold tax on their employees’ wages will receive a payment equal to 50% of the amount withheld, up to a maximum payment of $25k (across all lodgments).
- Delivered as a credit in the ATO activity statement system upon lodgement of eligible activity statements from 28 April 2020:
- Quarterly lodgers will be eligible to receive the payment for the March and June 2020 quarters;
- Monthly lodgers will be eligible to receive the payment for the March to June 2020 lodgments. Note that, to provide an equivalent benefit as that received by quarterly lodgers, monthly lodgers payment for the March activity statement will be calculated at a rate of three times (150%).
- The payment will be tax tree
Incentives for businesses:
- Increased threshold for instant asset write off – lifting to $150,000 (from $30,000) for new or second hand assets
- Asset must be first used or installed from the announcement until 30 June 2020.
- Accelerated depreciation deductions – deduct 50% of the cost of a new asset on installation with normal depreciation rules applying to the balance.
- Asset acquired after the announcement and first used or installed ready for use by 30 June 2021.
Supporting employers in employing apprentices and trainees:
- Eligible employers can apply for a wage subsidy of 50% of the apprentice’s or trainee’s wage paid during the 9 months from 1 January 2020 to 30 September 2020.
- Employers will be reimbursed up to a maximum of $21k per eligible apprentice or trainee ($7k per quarter).
- Available to small businesses employing fewer than 20 full-time employees who retain an apprentice or trainee.
- The apprentice or trainee must have been in training with a small business as at 1 March 2020.
- Access to the subsidy will be available after an eligibility assessment is undertaken by an Australian Apprenticeship Support Network (AASN) provider.
- Employers can register for the subsidy from early-April 2020. Final claims for payment must be lodged by 31 December 2020.
What’s in it for affected regions? Support for affected areas:
- The Government has set aside an initial $1 billion allocation to support those regions and communities that have been disproportionately affected by the economic impacts of Coronavirus.
- It will also include additional assistance to help businesses identify alternative export markets or supply chains.
- Targeted measures will also be developed to further promote domestic tourism.
The ATO will provide administrative relief for certain tax obligations for taxpayers directly affected by the Coronavirus outbreak, on a case-by-case basis.
The information contained in this email is in the nature of general comment and to be used for information purposes only. This is not to be relied upon or taken as advice.
For more information please contact our office on 9600 7760.
Angelo Argyros CA