Date published: 13 March 2020

Coronavirus (COVID-19)

Business Update

(updated 21 Jul 2020)

JobKeeper 2.0 has now been announced by the Government. As always, the devil will be in the details, and we will continue to update our clients and this page as new information is made available through OFFICIAL CHANNELS (no, that doesn't include the latest rumour being spread by the mate down the pub, or the Facebook post you saw by some random individual.......)

At this stage, this is what we know:

The payment is being extended until 28 March 2021 and will be targeting support to businesses who continue to be significantly impacted by COVID19
There will be no changes to the existing JobKeeper Payment scheme - if you are in receipt of JobKeeper then this will remain in place until 27 September 2020
From 28 September 2020, the JobKeeper payment will be staged to businesses that have been most significantly impacted, and the payment rates will be stepped down and a two tier payment will be introduced.
From 28 September 2020, employers will be required to reassess their eligibility for the JobKeeper extension, and this will be based on ACTUAL TURNOVER

Further information can be found here: JobKeeper Extension (from the Official Channels)

Existing Stimulus Measures

Here we provide updated information about assistance being provided to business, and also how we will ensure business continuity during this time - this will be updated as new information becomes available or if existing information changes, so bookmark if you need to.

Federal Stimulus Measures

On 12 March 2020, the Australian Government announced their economic response to the Coronavirus. Additional ecomonic reponses were announced on 22 Mar 2020. There are a number of key areas, with the following directly impacting on business:

Full details of the complete assistance (for both business and individuals) can be found here but in summary, here is what business will be able to access:

Boosting Cash Flow for Employers

This measure will provide up to $100,000 back to eligible small and medium sized businesses and Not For Profits that employ people, with a minimum payment of $20,000 to eligible business that employ staff. The payment will be tax free.

Eligible to business entities with an aggregated annual turnover <$50 million, and NFPs, including charities, with aggregated annual turnover <$50M
Must employ workers
Will be delivered by the ATO as a credit in the activity statement system from 28 April 2020 upon lodgement of activity statements
Payment will be equal to 100% of the amount withheld from employees salary and wages, up to a maximum payment of $50,000
Eligible businesses that pay salary and wages will receive a minimum payment of $10,000 even if they are not required to withhold tax.
An additional payment is being introduced in the July-Oct 2020 period, where elgible entities will receive an additional payment equal to the total of the previous payments they have recieved. This means elgible entities will receive at least $20,000 up to a total of $100,000 for both payments.

At this stage, there will be no direct action required by our clients who will be eligible to access this measure - it will be dealt with automatically upon lodgement of activity statements. Where the application of the measure places the activity statement account in credit, the ATO will trigger a refund within 14 days.

Supporting Apprentices and Trainees

Eligible employers can apply for a wage subsidy of 50% of an apprentice or trainees wage paid during the 9 months from 1 Jan 2020 to 30 Sep 2020. Where a small business is not able to retain an apprentice, the subsidy will be available to a new employer.

Eligible to 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 Mar 2020
Employers will be able to access the subsidy after an eligibility assessment is undertaken by an Australian Apprenticeship Support Network (AASN) provider
Employers can register for the subsidy from early April 2020, and final claims for payment must be lodged by 31 Dec 2020

If you have apprentices and/or trainees, please reach out to us for assistance and we can work with you to ensure you are correctly registered and able to claim for this measure.

Temporary Relief for Financially Distressed Businesses

Temporary increase to the threshold at which creditors can issue a statutory demand on a company and initiate bankrupt proceedings on and individual, and an increase to the time companies and individuals have to respond to statutory demands that have been received.
Threshold increases from $2,000 to $20,000
Timeframe increases from 21 days to 6 months.
Temoprary relieve for directions from any personal liability for trading while insolve.t
Temporary flexibility in the Corporations Act 2001 and to provide targeted relief from provisions of the act to deal with unforseen events that arise because of the Coronavirus health crisis
Tailored solutins for owners and directors of business currently struggling, including temporary reduction of payments or deferrals, or withhholding enforcement action including DPNs and windups.

Increasing the Instant Asset Write-Off **

The Government is increasing the instant asset write-off threshold from $30,000 to $150,000 and expanding access to include all businesses with an aggregated turnover of less than $500 million (previously $50 million).

Threshold applies on a per asset basis - businesses can immediately write-off multiple assets
Applies from the announcement (12 March 2020) until 30 Jun 2020, for new or second hand assets first used or installed ready for use in this timeframe

If you are considering purchasing assets, please consider the cashflow implications of the purchase. The increase to the instant asset write off DOES NOT mean that you will receive a tax refund, but rather that your taxable position as at 30 Jun 2020 will be reduced due to the expense being 100% recognised this financial year. Please contact your accountant or ourselves to discusss the cashflow implications further.

Backing Business Investment **

The Government is introducing a time limited 15 month investment incentive to support business investment and economic growth, by accelerating depreciation deductions.

A deduction of 50% of the cost of an eligible asset on installation, with existing depreciation rules applying to the balance of the assets cost.
Eligible to businesses with an aggregated turnover below $500 million
Eligible assets are new assets that can be depreciated under Division 40 of the Income Tax Assessment Act 1997, acquired after the announcement (12 March 2020) and first used or installed by 30 Jun 2020.
Does not apply to second hand Division 40 assets, or buildings and other capital works depreciable under Division 43.

We recommend that prior to purchasing assets that may be deductible under this measure, that you contact your Tax Agent and seek their specific advice, to ensure your business, and the asset being purchased is eligible for the measure.

** This information is of a general nature and should not be considered taxation advice

Support for Immediate Cash Flow Needs for SMEs

A guarantee of 50% to SME lenders to support new short term unsecured loans to SMEs

Quick and Efficient Access to Credit for Small Business

Cutting red tape by providing a temporary exemtpion from responsible lending obligations for lenders providing creit to existing small business customers

ATO Reference information for Federal Measures

Boosting cash flow for employers

ATO Support Measures

The ATO have released details on support measures to assist those affected by COVID-19.

The full media release can be found here

Deferral of payment dates for activity statements, income tax assessments, FBT assessments and excise
Option to change from 1/4 to 1/12 reporting to access GST refunds
Option to vary PAYGI to nil for the March quarter BAS and claim a refund for any instalments made for Sep and Dec 2019 quartgers
Remission of interest and penalties incurred on or after 23 Jan 2020
Availability to enter into low interest payment plans.

Other Business Support Details

Queensland

Queensland Government

Immediate Industry Recovery Package
Novel coronavirus small business Support
Queensland Rural and Industry Development Authority - Queensland COVID-19 Jobs Support Loans

Worker Transition Scheme and Rapid Response
$2.5 Billion Business and Industry Support
- Payroll Tax Support
  - Immediate payroll refunds
- Support for tourism operators and hospitality workers
- Support for Fisheries
- Support for Exporters
- Supporting displaced workers and direct industry assistance
- Rent relief for Businesses in government premises
- Liquor licensing waiver in 2020/21
Promoting Queensland
Counselling and support
Queensland COVID-19 jobs support loans
Mentoring Sessions
Financial Workshops
QRIDA - Job Support Loans of up to $250k for carry on finance with an initial 12-month interest free period for businesses to retain staff

Brisbane City Council

Business Relief Package

Chamber of Commerce and Industry Queensland

Business Essentials Subscription - Free

Sign up for our Business Essentials subscription by 31 March 2020 and pay nothing for 12 months. You’ll get Fair Work help when you need it, plus marketing insights and cost-saving tips to help you get through the worst trading conditions since the GFC. (Normally $792)

New South Wales

NSW Government

Waiver of Payroll Tax for businesses with payrolls of up to $10M for three months
Bring forward of raised Payroll Tax thresholds for next FY
$80M for fees and charges to be waived form small business such as cafes and restuarants, and those in trades

For details of NSW Government Stimulus package - Click here
NSW State Government website - https://www.nsw.gov.au/

Victoria

City of Melbourne (Local Council)

$10 Million local economic package
A Virtual Business Support Summit at Melbourne Town Hall
Suspending fees for Food Act registrations and street trading permits for 3 months
Halving rent for eligible tenants in Council owned buildings for 3 months

Details of City of Melbourne Stimulus Package - Click Here

Victorian Chamber of Commerce and Industry

https://victorianchamber.com.au/membership/join

12 month membership waiver for any new entrly level memberships (Networker - $350 and Essentials - $700), and credit to current members up to $500.

The Victorian Government is yet to announce a stimlus package.

South Australia

Government of South Australia

$25,000 cashflow assistance to small to medium sized businesses, with a minimum payment of $2,000 or eligible businesses
15 month incentive to support business investment and economic growth over the short-term
Wage subsidy if you employ and apprentices and trainees
$350 million stimulus package for local government to upgrade roads, hospitals, tourism infrastructure and expanded economic and business growth fund

Details of South Australian Stimulus Package - Click Here
Government of South Australia Website - https://www.sa.gov.au/

Western Australia

Government of Western Australia

Relief for businesses and households

$607 million stimulus package to support WA households and small businesses in the wake of COVID-19
$402 million to freeze household fees and charges until at least July 1, 2021
Freeze will apply to entire 'household basket', including electricity, water, motor vehicle charges, emergency services levy and public transport fares
Energy Assistance Payment (EAP) doubled to support vulnerable Western Australians, including pensioners
$114 million in additional measures to support small businesses
Small businesses that pay payroll tax will receive a one-off grant of $17,500
$1 million payroll tax threshold brought forward by six months to July 1, 2020
Businesses impacted by COVID-19 can defer payroll tax payments until July 21, 2020
Building on $760 million announced in the past few months to stimulate economy
Stimulus measures made possible due to McGowan Government's responsible financial management and strong budget surplus

For more details of WA Stimulus package - Click Here

Western Australian Government Website - https://www.wa.gov.au/

Tasmania

Tasmanian Government

Interest free loans available to small businesses in hospitality, tourism, seafood production and export section
Businesses with turnover of less than $5 Million will be eligible for loans to purchase equipment or restructuring business operations
Payroll tax waiver for businesses with payrolls up to $5 Million
Payroll tax deferred for 4 months for businesses in hospitality, tourism and seafood industries
Small businesses contracted by the state government to be paid within 14 days instead 30 days
$5,000 small business grant to assist in hiring apprentices or trainee in tourism, hospitality, construction or manufacturing industries
Fees wavier for certain licenses and leases applicable to small businesses

For more details of Tasmanian Stimulus package - Click Here
Tasmanian State Government Website - http://www.premier.tas.gov.au/

Northern Territory

Northern Territory State Government

$65 Million Jobs Rescue & Recovery plan for the purpose of keeping businesses open, maintaining cash flow and territorian working
Providing all eligible businesses with $10,000
If the recipient put in their own fund of $10,000, the government will match that with an additional $10,000- Creating a $30,000 value
Freezing government charges - including electricity, water and car registeration until 1st July 2021
$6,000 grant for Territory homeowners and landlords who spend $2,000 and, $4,000 grant who spend $1,000 in home improvement

For more details of Northern Territory Government Newsroom - Click Here
Northern Territory Government Website - https://nt.gov.au/

Fair Work

Coronavirus and Australian Workplace Laws

https://www.fairwork.gov.au/about-us/news-and-media-releases/website-news/coronavirus-and-australian-workplace-laws

Bank and Financial Institutions

Here is a comprehensive list of links to your banks financial hardship teams, from the Australian Banking Association
https://www.ausbanking.org.au/campaigns/financial-hardship/

Australian Competition and Consumer Commission (ACCC)

Media release - Advice on event and travel cancellations due to COVID-19

Centrelink

How to register your intention to claim a Centrelink payment - coronavirus (COVID-19)

Laurus and our business continuity strategy

For a number of years, Laurus Bookkeeping have been leveraging cloud based systems to service and support our clients. This has meant that the majority of our work is conducted off-site, with no requirement for face to face contact with our clients.

Our strategy is to continue to support and assist our clients in this manner, and we expect that any interruption to our business operations would only be triggered if one of our staff became unwell. In this situation, we have staff capacity to ensure that work can be undertaken by another member of our team, and that there is no disruption to our client deliverables.

We do, at times, have a requirement to meet with our clients for service delivery, and with the rapid global spread of Coronavirus, our focus first and foremost is on the safety of our employees.

With this in mind, and in line with our legal obligations and official guidance from relevant authorities, we have decided to suspend face to face contact with clients unless the requirement is critical.

All our staff will be available for phone advice or via Zoom video conferencing and we do not expect that there will be any disruption otherwise to our services.

For information in regards to best practice, we are relying on the following sources of information:

The next few months are going to be challenging for businesses and individuals in Australia, and across the world. If you have any questions about the government assistance packages being provided to business, please contact us.

Want to see if Xero is right for you?

We offer a full-featured demonstration and discussion about your business and how it could work with Xero for just $99! And, if you decide to engage our services further, we'll offset this cost against your first invoice.

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