Following the recent announcement by Scott Morrison of a $17.6b stimulus package, the following points are a brief snapshot of those elements of the package most likely to affect our business clients. These measures are yet to become law, but are, however, likely to do so imminently, and be effective from 12 March 2020. 

Employer businesses with a turnover of less than $50 million are to receive a subsidy payment of up to $25,000 tax-free, with a minimum payment of $2,000. These payments will be benchmarked to 50 per cent of the amount withheld on employees’ salary and wages, 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’re not required to withhold tax.
  • The measure will be delivered by the ATO as a credit in the activity statement system from 28 April 2020 upon businesses lodging eligible upcoming activity statements.
  • Employers who lodge the BAS on a quarterly basis will be eligible to receive the payment for the quarters ending March 2020 and June 2020. 
  • Monthly BAS lodgers will be eligible to receive the payment for the March 2020, April 2020, May 2020 and June 2020 lodgements, with a 150 per cent calculation in the March activity statement to provide the same treatment as quarterly lodgers.

To encourage investment in business assets, the instant asset write-off threshold is increasing fivefold, rising from $30,000 to $150,000. Access to the write-off will also be expanded to include businesses with aggregated annual turnover of less than $500 million, up from $50 million.

  • The expanded measure will only run until 30 June 2020.
  • Businesses with a turnover of less than $500 million will also now be able to deduct an additional 50 per cent in the year of purchase, as the government looks to introduce a time-limited 15-month investment incentive.

Supporting Employers of apprentices and trainees.

  • Eligible employers can apply for a wage subsidy of 50 per cent of the apprentice’s or trainee’s wage paid during the 9 months from 1 January 2020 to 30 September 2020, and this subsidy will be available to a new employer where the business is unable to retain an apprentice.
  • Employers will be reimbursed up to a maximum of $21,000 per eligible apprentice or trainee (i.e. $7,000 per quarter).
  • Eligible small businesses are those employing fewer than 20 full-time employees who retain an apprentice or trainee (with the apprentice or trainee being in training with a small business as at 1 March 2020). 

Waiting times for a government sickness allowance will be waived for casual workers forced into self-isolation.

Whilst the above is an overview of what we consider the elements most likely to be of interest to you, additional details from the ATO remains fairly sparse at this stage, but we will do our best to answer any questions you may have.

Please contact me if you have any questions or feel you need help.

Rose 

Partner RBG

Mobile 0405 510 380 or rose@rbgprivate.com