Very few businesses have thus far been unaffected by the COVID-19 Crisis. The team at GMD Advisory are continuing a 'business as usual' approach and are working hard to assist all clients with their enquiries. Our team is striving to answer all clients questions and concerns as promptly as possible. Currently we are in a waiting period until official legislation is released by the Morrison Government. Once Royal Assent is received we will contact all clients to organise a date to undertake your tax planning strategy sessions (immediately as opposed to June 2020) and to explain in depth how the Governments Economic Stimulus package uniquely affects their business.
Both the Federal and State Governments have announced a number of assistance packages for businesses amid the COVID-19 Crisis. Below are a list of Economic Stimulus Packages available to Australian businesses with several more expected to be annouced in the coming weeks. Please note legislation has not officially passed the Parliment for some of these measures.
Australian Federal Government
1. Cash Flow Tax Free Boost Payment
The Federal Government is helping small and medium businesses with aggregated annual turnover under $50 million to cover the costs of wages and salaries equal to 50 per cent of PAYG withheld for businesses that withhold tax, with a minimum of $20,000 and a maximum of $100,000 over six months. Businesses that pay salary and wages but are not required to withhold tax will also receive the minimum payment of $20,000. This will be a tax free payment, benefiting around 690,000 businesses employing 7.8 million people.
2. Increased Instant Asset Write Off Incentives
The threshold for instant asset writes-offs will be lifted to $150,000 from $30,000 and expanded to businesses with aggregated annual turnover of less than $500 million, up from $50 million, until 30 June 2020.
3. Accelerated Deprecation
The Federal Government is offering businesses a 15 month investment incentive to support their business, by accelerating depreciation deductions. This includes a deduction of 50 per cent of the cost of an asset, with existing depreciation applying to the balance of the asset’s cost. It is available to businesses with aggregated turnover below $500 million, purchasing certain new assets.
4. JobKeeper Payments
The JobKeeper payment is intended to provide wage subsidies to businesses that are significantly affected by COVID-19. Under the scheme businesses we be able to access a subsidy from the Government to continue paying their employees. Affected employers will be able to claim a fortnightly payment of $1,500 per eligible employee from 30 March 2020, for a maximum period of 6 months.
Queensland State Government
5. QRIDA Business Loans
In preparation for extended closures, the Queensland Government has made accessible a $500m loan facility, providing loans of up to $250,000 per business to assist with carry-on expenses such as employee wages, rent and rates and other related expenditure. The terms of these loans include no repayments or interest charged for the first year, followed by two years interest only at a 2.5% fixed interest rate with a maximum of a 10-year term of loan.
6. Payroll Tax Relief Package
The state government is offering Queensland businesses affected by COVID-19 payroll relief in the form of refunds of payroll tax for 2 months, a payroll tax holiday for 3 months or deferral of paying payroll tax for the 2020 calendar year.