As businesses endure many challenges ahead in these unprecedented times, the Australian Government have been working around the clock to provide individuals and businesses support to help see them through to the other side of this pandemic.
Since the 12th March 2020, the Australian Government have announced multiple stimulus and relief packages, designed to sustain small businesses and keep employees in work. The government has stated that the measures are temporary, targeted and scalable.
Below is a concise list of Government supports that you or your business may be eligible for.
Businesses impacted by the coronavirus (turnover reduced by more than 30 per cent relative to a comparable period a year ago, of at least a month) will be eligible for a subsidy from the Government to continue paying their employees.
Fortnightly payments of $1,500 will be available for employees to claim from March 30th 2020, for a maximum period of 6 months. This includes eligible employees that have been stood down or re-hired.
Businesses without employees that meet turnover tests, such as the self-employed, can also register their interest in applying for the JobKeeper Payment.
Expanded eligibility for job seeker payment for sole traders
Eligible sole traders will be granted access to the job seeker allowance, which now includes an additional coronavirus supplement of $550 per fortnight for the next six months.
The standard waiting periods and asset tests will be waived to allow quicker access to these payments. Individuals will still be able to keep operating their businesses and earn up to $1,075 per fortnight before their payments are affected. On 30 March, it was announced that the income test for partners of jobseekers will be increased from $48,000 to $79,762 to provide greater access.
Who is eligible?
Sole traders that meet the job seeker allowance income test.
After your application has been approved via the Services Australia website.
Early access to superannuation
The Government is also allowing sole traders who have seen their hours of work or income fall by 20 per cent or more as a result of the pandemic to access their superannuation. This is capped at $10,000 this financial year and a further $10,000 next financial year. The withdrawals will be tax free.
On successful application via the myGov website when applications open in April 2020.
Additional payments for employers to retain staff
Not-for-profits and small businesses with a turnover under $50 million will receive a tax-free cash payment of from $20,000 up to $100,000 to help them retain staff and continue operating.
Eligible entities will receive an additional payment equal to the total of all of the ‘boosting cash flow for employers’ payments received.
The Government expects 690,000 businesses employing 7.8 million people and 30,000 not-for-profits will be eligible for measures in the stimulus package. The payments are tax free, there will be no new forms and payments will flow automatically through the ATO.
Who is eligible?
Small and medium business entities with aggregated annual turnover of less than $50 million and that employ workers are eligible. The payment will be available from 28 April 2020. An additional payment is also being made from 28 July 2020.
SME Guarantee Scheme
The Government will provide a guarantee of 50 per cent to small and medium enterprise (SME) lenders for new unsecured loans to be used for working capital for small to medium businesses, to enable them to access additional funding to help support them through the upcoming months.
Businesses with a turnover of up to $50 million will be eligible to receive these loans, up to $250,000 per borrower. The loans will be up to three years, with an initial six month repayment holiday and will be in the form of unsecured finance.
Who is eligible?
Businesses with a turnover of up to $50 million that pass the lenders’ credit assessment processes. The scheme will commence by early April 2020 and be available for new loans made by participating lenders until 30 September 2020.
Wage subsidy for apprentices and trainees
Eligible employers can apply for a wage subsidy of 50 per cent of an apprentice’s or trainee’s wage for up to 9 months from 1 January 2020 to 30 September 2020. Businesses can be reimbursed up to a maximum of $21,000 per eligible apprentice, (which is $7,000 per quarter for the first three quarters of 2020).
Who is eligible?
Small businesses with fewer than 20 full time employees who retain an apprentice or trainee. The apprentice must have been in training with the small business as at 1 March 2020.
You will be able to register for the subsidy from early April 2020. For more information on how to apply, including eligibility criteria, contact an Australian Apprenticeship Support Network (AASN) provider. Please note: Claims for this subsidy must be lodged by 31 December 2020.
Increase in the instant asset write-off threshold
The instant asset write-off threshold has been increased from $30,000 to $150,000. The higher threshold is in place from 12th March until 30th June 2020 and applies to new or second-hand assets installed in businesses during these dates.
Who is eligible?
Businesses with aggregated annual turnover of less than $500 million (up from $50 million).The instant asset write-off is claimed back via your business tax return.
The Australian Tax Office (ATO) will also consider relief for certain tax obligations to eligible businesses, including deferring tax payments up to four months.
If disruption to your business operations causes you to fall behind with your tax and super obligations, read the ATO's information on COVID-19, call them on 1800 806 218 or speak to your tax professional so that they can work with you to find a solution.
A number of other measures designed to support households and boost the economy are also included in the package:
- Two tax-free $750 stimulus payments to individual income support recipients and eligible concession card holders. The first payment will be rolled out from 31 March 2020 and the second from 13 July 2020.
- Targeted regional and community support aimed at businesses and communities particularly affected by the economic downturn due to coronavirus, for example those in the tourism, agriculture and education industries. This support will include waiving fees and charges for tourism businesses operating in national parks, plus assistance in identifying new export markets and supply chains.
More information about the Government support can be found here.