7 Actions you can take NOW!
We want to help you to continue to employ as many people as possible.
Our aim is to provide you with simple & actionable information to assist you to continue now (with the least amount of stress) & to be positioned to flourish now or atleast when this crisis is over.
Take advantage of EVERY government incentive & support option
IT IS CRITICAL THAT ALL YOUR BAS & TAX LODGEMENTS ARE UP TO DATE
TO BE ENTITLED TO MANY OF THE GOVERNMENT INCENTIVES
Summary of order of importance:
- Contact your bank – defer ALL business loans & personal mortgages for the maximum 6 months (this has been taking on average 10mins for clients to do)
- Contact your bank about your eligibility to the SME Guarantee Scheme for a maximum loan of $250,000 (details below)
- Lodge your March BAS on time to take advantage of any government incentives
- Rent – negotiate with your landlord
- Questions about employee entitlments – talk to Employsure with our client code (details below)
- Defer any payments to ATO, including BAS (talk to us)
- Understand your cashflow & look at different possible scenarios
Job Keeper Payment
Eligible businesses will be paid up to $1,500 per fortnight, for eligible employees for the next six months
What we know so far:
- Businesses will be paid up to $1,500 per fortnight, per eligible employee, for the next 6 months
- Eligible employees as at 1 March 2020 and each eligible employee is currently engaged
- Businesses must have had a drop in turnover of at least 30 per cent due to coronavirus to qualify for the payments to give their workers
- Payments will start from first week of May, backdated to March 30
- Legal obligation on employers to pass on the full wage subsidy to employees
- Payments for full-time workers, part-time workers, sole traders & casuals (employed for 12months or more)
This is designed by the government to enable employers to keep paying their staff during the coronavirus crisis, in an effort to ensure workers still have a job once the pandemic has subsided.
NOTE: Until this is passed by parliament (expected early April) we have limited details
SME Guarantee Scheme
The government is assisting lenders to provide loans to businesses up to $250,000 who are experiencing, or anticipating, cashflow disruption due to COVID-19
Benefits of the loans include:
- Unsecured loan for up to $250,000 (banks are making this easy)
- Term of up to 3 years, with initial 6 month repayment holiday
- Interest to be charged only on the amount drawn, so businesses do not have to use the entire facility
- Government will guarantee 50% of the loan to the lender to encourage new loans
- new loans made by participating lenders up to 30 September 2020
- Applications can be made from today 1st April with some some lenders, other lenders will have their offer available early April
Note: be paitient if you are calling a banks general help line as they have been overloaded with calls this week, keep trying.
Stimulus – boosting cashflow for employers
|The government will provide cash flow boosts to eligible businesses, delivered through CREDITS in the activity statement system, when businesses lodge their activity statements. |
This will be between $20,000 and $100,000 for eligible businesses.
- The initial payment will be delivered by the Australian Taxation Office (ATO) as a credit in the activity statement system starting from 28 April 2020
- Employers that withhold tax to the ATO on their employees’ salary and wages quarterly will receive a payment equal to 100 per cent of the amount withheld (monthly withholders 300% credit), 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 equivalent to the total of the initial of cash boost credits that would have been received will be available if the business continues to be active
- The additional payment will be delivered as credits in the June and September BAS’s for quarterly lodgers and June, July, August & September for monthly lodgers
- Small and medium business entities with aggregated annual turnover under $50 million and who employ workers will be eligible (based on the prior year’s turnover)
Note: we have been contacting the Tax Office daily to understand exactly how this will be applied. There is still no clear guidance other than once they receive BAS’s they will have some test cases & provide more information – stay tuned.
More information: Treasury fact sheet
If you have questions around specific awards & employers obligations
We have partnered with Employsure who specialise in employee relations.
As a client of The Horizon Group you can speak to them directly to get some free advice.
Please contact our office for our partner code.
Freeze on Evictions
National Cabinet agreed to a freeze on evictions for the next six months for commercial and residential tenancies in financial distress due to the impact of coronavirus.
They are encouraging:
- tenants and landlords to agree on rent relief or temporary amendments to the lease
- reduction or waiver of rental payment for a defined period for impacted tenants
- the ability for tenants to terminate leases and/or seek mediation or conciliation on the grounds of financial distress
- commercial property owners to ensure that any benefits received in respect of their properties should also benefit their tenants in proportion to the economic impact caused by coronavirus
- landlords and tenants not significantly affected by coronavirus are expected to honour their lease and rental agreements
- cost-sharing or deferral of losses between landlords and tenants, with Commonwealth, state and territory governments, local government and financial institutions to consider mechanisms to provide assistance
Self Managed Superfunds – Rent relief
SMSF’s offering a rent reduction to a related party, for 2019-20 and 2020-21 the ATO have confirmed they will not take action.
Other useful links
Cirque du Soleil
Animal Cam – Zoos Victoria live stream
Underwater Cam – live feed
Australian Taxation Office
Dealing with disasters
The Australian Government’s economic response to coronavirus
Stimulus announcements made on 23 March
Treasury – guidance for business
Treasury – guidance for business investment
Treasury – guidance for households
Simple! Smart! Different!
This information is intended to provide general information only and has been prepared without taking into account any particular person’s objectives, financial situation or needs. Before acting on such information, you should consider the appropriateness of the information