We understand that times are difficult for small businesses at present. To help you access financial and other support incentives that can help your business move through this time, we have compiled a list below. We will endeavour to keep this page updated as new announcements are made, and strongly encourage you to contact our office on (02) 4990 3775 or by emailing us at firstname.lastname@example.org if you have any questions. You can also read our blog on how to manage your employer responsibilities during this time here.
Sole Traders or Businesses with No Employees:
- The Instant Asset Write-off threshold has been increased from $30k to $150k and now includes all businesses with an aggregated annual turnover of less than $500 million (up from $50 million). This increase applies from 12 March 2020 until 30 June 2020 and can be used for new or second-hand assets first used, or installed and ready for use, within this timeframe. Importantly, the IAWO is due to revert to $1,000 for small businesses (turnover less than $10 million) from 1 July 2020.
- By accelerating depreciation deductions, the Government is committed to backing business investments to improve economic growth from 12 March 2020 until 30 June 2021. This scheme will provide businesses with a turnover of less than $500 million the ability to deduct 50% of the cost of an eligible asset on installation, with existing depreciation rules applying to the balance of the asset cost.
You can find out more about these business investment support packages here.
Businesses with Employees:
- PAYG Withholding Support Package: to help small businesses cover the costs of employee wages, this support package can provide a tax credit or refund of up to 100% of the PAYG Withholding Tax (i.e. the tax you pay on your employees' wages). This is to be calculated as follows:
- A minimum $10,000 credit for small businesses paying wages even if there is no requirement to withhold PAYG tax from those wages.
- A credit or cash refund of 100% of PAYG tax withheld from wages for the March 2020 and June 2020 BAS, up to $50,000.
- A further credit or cash refund of up to $50,000 will be available once the September BAS is lodged.
Even if you do not withhold tax, you may still be eligible to receive a minimum payment of $10,000 if you pay salary and wages. It is important to note that small businesses will only receive a cash refund if they have fully paid their BAS obligations to the ATO. If money is still owed to the ATO, this support package credit is likely to be used to reduce that ATO debt as a credit, not a cash refund. This payment will occur when you lodge your activity statements. More information can be found here.
- If you have apprentices or trainees, you might be eligible for a wage subsidy of 50% of their wage paid from 1 January 2020 to 30 September 2020, up to a maximum of $21,000 per eligible apprentice or trainee ($7,000 per quarter). This is an initiative to help you retain these workers, and if you are unable to do this, the subsidy will be made available to a new employer. To claim this support, employers will need to register for the subsidy from early April 2020. You can find out more about your eligibility and how you can apply for contacting an Australian Apprenticeship Support Network provider. More information can be found here.
- For your casual employees who cannot work due to being sick, needing to self isolate, or their income is otherwise affected by COVID-19, you should advise them of income support payments that might be available for them. You can find out more in the General Support Measures section below.
General Support Measures:
- You might be able to access some relief for some tax obligations for businesses if you are affected by the outbreak, but this is decided by the ATO on a case-by-case basis. You will need to contact the ATO's Emergency Support Infoline for businesses – 1800 806 218 – to request this help.
- With businesses closing and many employees losing their jobs, the government has announced a number of supplements to income support payments. If you have lost your job or are a sole trader or contractor affected by COVID-19, you may be entitled to a new coronavirus supplement under expanded access to the JobSeeker Payment, formerly known as Newstart. This supplement is to be paid for up to 6 months, with a maximum payment of $550 per fortnight. This payment is in addition to any normal Centrelink entitlement, including the usual JobSeeker Payment. You can phone 180 22 66 or click here or here for more information.
- ATO Assistance with Tax Debt: The ATO has also announced that they are offering relief measures for businesses affected by COVID-10. These include:
- Allowing a further 6 months to pay the ATO amounts owing from your BAS, income tax return, FBT return or excise.
- Providing the option for businesses to swap to monthly GST reporting to access GST refunds quicker.
- Allowing businesses to vary PAYG Instalments to nil in the March 2020 quarter and claiming a refund for prior quarters.
- Remitting interest and penalties applied from 23/01/2020 which relate to tax liabilities.
- Organising low-interest payment plans for ATO debts.
You can find out more information here.
Early Access to Super: The Government has announced that certain individuals can access tax-free payments from their Super Fund from mid-April. Applications will be available via your MyGov account for up to $10,000 prior to 30/06/2020, with a further $10,000 on or after 01/07/2020. These payments will not affect your entitlement to Centrelink or Veterans Affairs payment eligibility. Eligible individuals include those who are:
- unemployed, or
- eligible to receive a Job Seeker Payment (previously known as Newstart Allowance), youth allowance for job seekers, parenting payment, special benefit or Farm Household Allowance, or
- on or after 1 January 2020
- were made redundant, or
- had their working hours reduced by 20% or more, or
- for sole traders, their business was suspended or there was a reduction in their turnover of 20% or more.
The ATO is to release further guidance on how individuals can access super from their Self Managed Super Fund (SMSF) in the near future. In the meantime, you can find out more here.
- Minimum Super Pension Drawdown Rates: With the stock market falls affecting many super funds, the ATO have announced a 50% deduction in the minimum pensions for 2019-20 and 2020-21 as follows:
Age Previous Minimum Pension New Minimum Pension
Under 65 4% 2%
65-74 5% 2.5%
75-79 6% 3%
80-84 7% 3.5%
85-89 9% 4.5%
90-94 11% 5.5%
95 or more 14% 7%
You can find out more here.
- Reduction in Social Security Deeming Rates: With the reduction in interest rates, the government has now reduced the deeming rates for social security pensions to 0.25% (lower rate) and 2.25% (upper rate). While not a huge reduction, this will help to increase the pensions received by people with investment income. More information can be found here.
- A small business relief package from Australia's banks has been announced, with small businesses being affected by COVID-19 being able to defer loan repayments for six months. While this package is still subject to authorisation by the ACCC, you may have already been contacted by your bank with information on how to apply. If not, we encourage you to contact your bank to find out how they can assist you.
- A number of accounting software have released pricing and support guidelines targeted at supporting businesses through this time. For example, MYOB have addressed your immediate cash flow concerns by immediately suspending any price rises until further notice, reviewing payment terms to provide flexibility to industries hit hardest, implemented a dedicated hardship application support team and helping you access government grant information. We encourage you to investigate what options your software has, and if you reach a point of concern, consider the benefits of completing a financial hardship application.
Leading your business, family and community through times like these is mentally and physically very draining. Because of this, it is even more important than normal to look after yourself and listen to your limits. Our team is only a phone call away when you need business assistance, but if you are feeling worn down and anxious, it is important you talk to someone qualified. You can find a number of 24/7 helplines here, or, you can call Beyond Blue at any time on 1300 224 636.
 Eligible assets are those able to be depreciated under Division 40 of the Income Tax Assessment Act 1997, that were acquired after the announcement of this scheme and first used or installed by 30 June 2021. Importantly, this does not apply to second-hand Division 40 assets, or buildings and other capital works usually depreciated under Division 43.