The impact of COVID-19 has been felt by small and medium businesses in most industries. The Australian government is supporting Australian businesses to retain their employees, manage cash flow challenges and keep business going. The government has termed this “hibernation” in the hope that businesses will bounce back once things return to normal.
A number of measures have been announced for businesses to withstand and recover from the economic impacts of this catastrophic event.
The Australian Government under the leadership of Scott Morrison has taken unprecedented steps to minimise the economic impact to most Australians.
We have provided links and information about some the important measures below:
Jobkeeper Payment
This payment of $1,500 per fortnight (before tax ) is to help with the payment of wages of employees. Eligible businesses will be able to claim $1,500 per employee from 30 March 2020. You need to ensure that you register all your eligible employees with the ATO through their online portal. You can register your interest at https://www.ato.gov.au/Job-keeper-payment/
There are some very important factsheets on the Treasury website explaining the operation of this scheme :
https://treasury.gov.au/sites/default/files/2020-04/Fact_sheet_supporting_businesses_0.pdf
https://treasury.gov.au/sites/default/files/2020-04/Fact_sheet_Info_for_Employers_0.pdf
If you are operating a business as a Sole Trader or Partnership you will also be able to access this $1,500 payment if you meet the eligibility criteria. Please see the below fact sheet for more info:
https://treasury.gov.au/sites/default/files/2020-04/Fact_sheet-Support_for_sole_traders.pdf
Cashflow assistance
This package provides up to $100,000 for eligible small and medium-size businesses that employ staff to help with their cashflow to pay rent, electricity, other bills and staff.
This benefit will be paid in 2 instalments through credits on your activity statement. You do not need to apply for this benefit with a separate form.
Eligible businesses and NFPs, must have held an Australian Business Number (ABN) on 12 March 2020 and lodge their activity statement to receive the credit. Charities registered with the Australian Charities and Not for Profits Commission are eligible, regardless of when they were registered, if they meet the other eligibility requirements.
For more information on eligibility and worked examples please have a look at the following factsheet :
https://treasury.gov.au/sites/default/files/2020-04/fact_sheet-boosting_cash_flow_for_employers.pdf
Temporary Relief
The Government is temporarily increasing the threshold at which creditors can issue a statutory demand on a company and the time companies have to respond to statutory demands they receive. The package also includes temporary relief for directors from any personal liability for trading while insolvent, and providing temporary flexibility in the Corporations Act 2001 to provide temporary and targeted relief from provisions of the Act to deal with unforeseen events that arise as a result of the Coronavirus health crisis.
You can find more information in the following factsheet :
Increasing the instant asset write-off
Under normal circumstances, individual assets less than $30,000 are eligible for the instant asset write off. The Government has lifted this threshold to $150,000 for assets that are either installed or ready for first use by 30 June 2020.
Relief for Commercial tenants
The Prime Minister has announced a mandatory code of conduct for commercial tenancies covering businesses whose annual turnover is up to $50 million and eligible for the Jobkeeper Payment.
Rent reductions will be based on the tenant’s decline in turnover to ensure that the burden is shared between landlords and tenants.
Each state and territory will implement and regulate this code separately.
You can find more information at :
We will be keeping you up to date with the latest developments and will soon include a list of professionals who are available to help you in case you require any assistance.
