By Charles Talbot
Yesterday Scott Morrison announced the details of a $17.6b stimulus package to help combat the impact of the coronavirus to business and the economy.
The key components are:
Encouraging Business Investment:
Increasing the instant asset write off:
From 12 March 2020 until 30 June 2020 the government is increasing the instant asset write off from $30,000 for businesses with a turnover of less than $50 million to $150,000 for businesses with a turnover of less than $500 million.
The instant asset write off is due to revert to $1,000 for small businesses (turnover less than $10 million) from 1 July 2020.
Backing business investment:
There is 15-month investment incentive through to 30 June 2021. This allows businesses with a turnover of less than $500 million to deduct 50 percent of the asset on installation with the remainder being deducted under existing depreciation rules.
Cashflow Assistance for Employers:
This will provide a tax-free payment of up to $25,000 (minimum $2,000) to employers with an aggregated annual turnover of less than $50 million.
Eligible businesses that withhold tax to the ATO on their employee’s salary and wages will receive a payment equal to 50% of the amount withheld, up to the maximum of $25,000. The payment will be delivered as a credit in the activity statement upon lodgment. The eligible periods are:
Quarterly lodgers will be eligible to receive the payment for the quarters ending March 2020 and June 2020.
Monthly lodgers will be eligible to receive the payment for the March 2020, April 2020, May 2020 and June 2020 lodgements.
To provide a similar treatment to quarterly lodgers, the payment for monthly lodgers will be calculated at three times the rate (150 per cent) in the March 2020 activity statement.
Supporting apprentices & trainees:
The subsidy will be available to small businesses employing fewer than 20 full-time employees who retain an apprentice or trainee. The apprentice or trainee must have been in training with a small business as at 1 March 2020.
Eligible employers can apply for a wage subsidy of 50 per cent of the apprentice’s or trainee’s wage paid during the 9 months from 1 January 2020 to 30 September 2020. Employers will be reimbursed up to a maximum of $21,000 per eligible apprentice or trainee ($7,000 per quarter).
Employers can register for the subsidy from early-April 2020. Final claims for payment must be lodged by 31 December 2020. Further information is available at:
One-off payments of $750 will be paid to around 6.5 million lower-income Australians, including pensioners, other social security and veteran income support recipients and eligible concession card holders. For eligibility check here
Assistance for severely affected regions:
The Government has set aside an initial $1 billion allocation to support those regions and communities that have been disproportionately affected by the economic impacts of the Coronavirus, including those heavily reliant on industries such as tourism, agriculture and education. The $1 billion will be provided through existing or newly established Government programs.
Learn more from treasury on how this will impact you or your business. Alternatively, please do not hesitate to contact our office.