Coronavirus: Financial support from the Australian Federal Government

Federal government support package

The Morrison Government’s plan to keep business in business and Australians in jobs provides direct support for business including payments for business, wage subsidies for apprentices and trainees and enhancing the instant asset write-off:

  • Tax-free cashflow boost for employers. Up to $100,000 is available to help pay wages or for investment to protect against a downturn in activity. The payments are open to businesses with a turnover of less than $50 million. Eligible businesses that withhold tax on employee salary and wages will automatically receive a payment equal to 100% of the amount withheld. The minimum payment is $10,000 and maximum is $50,000 and will be available for businesses who lodge business activity statements for the March and June quarters. An additional payment is available in the July - October 2020 period during which Eligible businesses receive an additional payment equal to the total of the payments received in the March & June quarters. This means that eligible entities will receive at least $20,000 up to a total of $100,000 under both payments. Read the Fact sheet
  •  Apprentice wage subsidy. Small businesses with fewer than 20 full-time workers will receive 50% of an apprentice or trainee’s wage. For each apprentice or trainee, the Government will provide up to $7,000 in wage assistance per quarter. The wage subsidy will be open to businesses with fewer than 20 full-time workers and employers of any size that re-employ someone who loses their position as a result of the coronavirus downturn. Read the Fact sheet
  •  Boosted instant asset write-off. Businesses with turnover of less than $500 million are eligible for an expanded instant asset write-off for asset investments of up to $150,000. The threshold applies on per asset basis, so businesses can immediately write-off multiple assets. Read the Fact sheet
  •  Accelerated depreciation. Businesses with turnover less than $500 million will be able to access a 15 month investment incentive by accelerating depreciation deductions. Read the Fact sheet
  •  Income support. People who are unable to attend work because they have been diagnosed with the Coronavirus or who are in isolation, may qualify for income support if they do not have any employer leave entitlements. Read the Fact sheet
  •  Australian Taxation Office (ATO)

The ATO has stated that it will “work shoulder-to-shoulder with businesses” to assist them through this difficult period and do what we can to ease the pressure by providing tax relief to affected businesses in the form of payment deferrals and faster access to goods and services tax refunds.

The ATO said employers must still meet ongoing super guarantee obligations for employees during this time, these measures to support those affected by coronavirus will not be automatically rolled out, and businesses must contact the ATO to get access to a tailored support plan.

A number of options will be available to affected businesses, including four-month deferrals for the payments of amounts due through business activity statements (including Pay-As-You-Go instalments), income tax assessments, fringe benefits tax assessments and excise.

The ATO may also allow businesses that are on a quarterly reporting cycle to switch to monthly GST reporting so they can gain quicker access to any available GST refunds.

Businesses may also be permitted to vary PAYG instalment amounts to zero for the April 2020 quarter, said the ATO. Businesses that opt to do so may then be able to claim refunds for instalments made for the September 2019 and December 2019 quarters.

Further, the ATO said it may also be able to remit any interest and penalties incurred since January 23, which have been applied to tax liabilities, and will allow businesses to enter into low-interest payment plans for existing and ongoing tax liabilities.

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