In this email, we have set out the main parts of the stimulus package that apply to most of our client base, in a relatable way for you and your business.
We have already broadcast the full details of our package through our business newsletters, web page and Facebook page. This email does not cover every aspect, only the ones we believe most relevant to the majority of our client base.
From 27 April, you may be eligible to receive a fortnightly payment of $550, plus two separate payments of $750 tax free. You must be registered with Centrelink and the payment will come from them - not the ATO. There are new asset thresholds and categories, so please ensure you have a Mygov account and register for it. It includes employees who have been stood down, sole traders, self-employed, casual workers and contract workers. You should contact Centrelink for these payments and the first payment will be paid from 31 March. The second payment will be paid from 13 July 2020.
FOR ACCESSING SUPER
There are new compassionate grounds for release of your super up to $10,000 before 1 July 2020, and a further $10,000 after that date. You must be an unemployed individual, who is eligible for Centrelink payments, where your working hours have reduced by 20% or you are a sole trader and your income has reduced by more than 20%. Please know that you are accessing your own superannuation monies early and tax free.
You will be able to apply from mid-April and must apply online to the ATO using The MyGov website as superannuation funds are not able to accept applications directly. All applications must be made within six months of the announcement with this incentive. We are able to apply for this for you, if you are unable to do so.
ASSISTANCE TO BUSINESSES
If you employ staff you are entitled to a total credit of up to $100,000 (with a minimum of $20,000) from 28 April on your Activity Statement. You will receive a credit equal to 100% of the PAYG Tax Withheld on wages for that quarter. If you report monthly, you will receive 3 times that monthly amount on your March Activity statement.
Eligible employers will receive a minimum of $10,000 even if you are not required to withhold tax on wages upon lodgement of the statement with the ATO.
STAGE 2 FOR BUSINESSES
For employers that continue to be active through to next quarter, an additional withholding credit will be available for the June to September quarter. This amount will be 50% of the initial amount received to a maximum of $50,000.
The ATO will automatically calculate these tax free payments as a credit to the activity statements lodged. Please note that you must be a registered employer with the ATO as a tax withholder prior to the 12 March to be eligible.
APPRENTICES AND TRAINEES
Employers may be entitled to Government funded wage subsidies equal to 50% of the apprentice’s or trainees wage paid during the 9 months to September, to a maximum of $21,000 per eligible apprentice or trainee. You can access this through Australian Apprenticeship Support Network providers.
INSTANT ASSET WRITE OFF
The threshold for the immediate write off for assets is now up to $150,000 until 30 June 2020. Any new or second hand assets purchased before this date can be claimed fully in this tax year as a depreciation write off for your business. It is based on the GST exclusive cost of the asset purchased between 12 March and 30 June 2020.
We have prepared this summary to assist you with the general application of these measures as they may apply to you. We suggest you read our full bulletin available from our website, Facebook or email.
In addition, when we prepare your March BAS, we will contact you to ask if you would like some tax planning support to ensure you take full advantage of these measures and are ready for the 30 June cut off for tax breaks. It is a specialised tax planning service for your business and we highly recommend you engage our office to assist you in these times. If we do not prepare your BAS for you, please email us and we will arrange a suitable time to prepare some financial statements and projections, and meet with you.
Given the current health issues, we are encouraging either phone conferences or Skype video appointments where possible so please contact us to arrange this if you wish to engage our assistance and support.
Stay safe and take care