As many of you would be aware, last week the Federal Government announced an aid package for business in a bid to help them better manage the financial impacts and challenges of the Coronavirus.
Here’s a quick insight into what we know so far, but finer details are yet to be confirmed. In the meantime, you can also read my post on “Getting down to business in a crisis” which looks at steps you can take now as a business operator.
But let’s kick off with the Government’s aid package.
Last week, the Government announced the following raft of stimulus measures in response to coronavirus:
Businesses will be eligible to receive up to $25,000 in order to keep cash circulating in the economy.
The Government explains:
“Small and medium business entities with aggregated annual turnover under $50 million and that employ workers will be eligible. Eligibility will generally be based on prior year turnover.”
Point to note:
- The payment will be delivered by the Australian Taxation Office (ATO) as a credit in the activity statement system from 28 April 2020 upon businesses lodging eligible upcoming activity statements.
- Eligible businesses that withhold tax to the ATO on their employees’ salary and wages will receive a payment equal to 50 per cent of the amount withheld, up to a maximum payment of $25,000.
- Eligible businesses that pay salary and wages will receive a minimum payment of $2,000, even if they are not required to withhold tax.
In order to help businesses retain their apprentices and trainees, the Government is allowing eligible employers to apply for a wage subsidy of 50 per cent of the apprentice’s or trainee’s wage paid during the nine months from 1 January, 2020 to 30 September, 2020.
Where a small business is not able to retain an apprentice, the subsidy will be available to a new employer. Employers will be reimbursed up to a maximum of $21,000 per eligible apprentice or trainee ($7,000 per quarter).
Instant asset write-off
As an extra incentive to keep money moving in the economy, the instant asset write-off threshold has been increased from $30,000 to $150,000 and expanded access to include businesses with aggregated annual turnover of less than $500 million (up from $50 million).
The Federal Government explains: “This applies from 12 March 2020 until 30 June 2020, for new or second‑hand assets first used or installed ready for use in this timeframe”.
Information about eligibility is available here
$750 cash bonus
In addition, more than $6 million Australians will receive a cash bonus of $750 each, which the Federal Government is hoping families will use within the local economy.
In the meantime, you can access the full government fact sheet for business incentives here.