Updated 14th April.
****Important update on JobKeeper applications - the ATO will open applications on the 20th of April via their Online Services which can be accessed using your myGov ID or my our office.
See also our recent newsletters. Most importantly we are here to help with these measures as they apply over the next six months.
JobKeeper (ATO) QLD Business Loans QLD Payroll Tax Relief
Income Test: To be eligible for the subsidy your business must:
have suffered, or be forecast to suffer, a reduction in GST turnover of,
30% or more for most employers
15% for ACNC registered charities,
50% for businesses with GST turnover greater than $1bn, for
the months of March, April or the June Quarter for eligibility from 30th March, or
any following month to September, or the September quarter for eligibility for that month onwards, which
only needs to be satisfied once to be eligible for the remaining period, and
an alternative test is available by application to the ATO and will be stringently applied for situations where the law has not operated in spirit.
Please be aware that if you are not GST registered, the legislation makes amendments to treat you as if you are, and you will still be eligible. Carve-outs are also available for gifts received for deductible gift recipients, and for people operating solely overseas.
Application: Applications will need to be made to the ATO to claim the subsidy. Your employees must provide you with a nomination notice disclosing eligibility before applying. Employees receiving Paid Parental Leave, Dad and Partner Pay, or Workcover that has left them unable to work are ineligible. Applications should be made before the end of April 2020 to be eligible from the start date (30 March 2020) although the ATO is making note that the application can be done as late as the end of May. You must then notify employees they've been elected for the payment within 7 days of application.
Payments: Future payments will be made monthly in arrears, no later than 14 days after the end of the month eligible payments were made in. The last eligible fortnight is the 27th September 2020, with the last payment due no later than 14th October 2020. You must report your current and projected GST turnover within 7 days at the end of each month you qualify (i.e. you report in the first week after month-end, the ATO pays you in the second week), although reported amounts do not affect eligibility. We expect payments will be made to the account used for BAS refunds, or where not available, the listed account on the latest income tax return.
The ATO retains authority to recover any overpayments plus interest where the entity or employee is ineligible.
Employers will receive the payment for each eligible employee who was; employed on 1 March 2020, over the age of 16, continues to be engaged by that employer, and is a permanent full-time, permanent part-time, or a casual worker that was employed for over 12 months as at 1 March 2020. This includes stood down employees and employees who had been terminated but re-engaged, if they satisfied these employment conditions on 1 March 2020. Employees must be an Australian resident or a 444 special visa holder.
The JobKeeper payment will also apply to a single approved associate or sole trader where you were not considered an 'employee' on 1 March 2020 but had an active role in the business. The same conditions for an employee need to be met, including a nomination form to be completed, and for all entities excluding sole traders, a letter advising the election was made must be provided to the elected individual. Approved associates are:
a director of a company, or
a shareholder of a company, or
a partner of a partnership, or
an adult beneficiary of a trust.
Once an individual is nominated, another individual cannot be 'exchanged' in a later fortnight.
Employees who normally receive more than $1,500 per fortnight in wages must still be paid their standard hourly rate however hours can be adjusted in limited circumstances under the Fair Work Actchanges. You will receive the full $1,500 subsidy for employees who continue to receive normal wages.
If the employee ordinarily receives less than $1,500 per fortnight or is stood down without pay, they must be paid the minimum $1,500 per fortnight, regardless of the hours they actually work. The $1,500 can be made up of:
net amounts paid to the employee,
salary sacrificed amounts to the employee's super fund,
any other manner agreed by the individual and the employer as reasonable.
Superannuation must still be paid on the usual basis (on Ordinary Time Earnings for hours worked) however, it is not compulsory to pay super on any additional amount up to $1,500.
Boosting cash flow for employers
The Government is providing up to $100,000 to eligible small and medium-sized businesses (aggregated annual turnover under $50m), and not for-profits (NFPs) that employ people, with a minimum payment of $20,000.
For eligible wages paid between January - June 2020 period, employers will receive a payment (credited to their ATO account) equal to 100 per cent of their salary and wages tax withheld (PAYG W). The minimum payment is $10,000 with a maximum payment of $50,000. These will commence from the 28th of April.
A second additional payment is also paid for the July – October 2020 period. Eligible entities will receive an additional payment equal to the total of the Boosting Cash Flow for Employers payments they have received. This means that eligible entities will receive at least $20,000 up to a total of $100,000 under both payments
Increasing the instant asset write-off
The Government is increasing the instant asset write-off threshold from $30,000 to $150,000 and expanding access to include businesses with aggregated annual turnover of less than $500 million (up from $50 million) until 30 June 2020. From the 1st of July 2020, this is due to drop to $1,000.
Backing business investment
The Government is introducing a time limited 15 month investment incentive (through to 30 June 2021) by accelerating depreciation deductions. Businesses with a turnover of less than $500 million will be able to deduct 50 per cent of the cost of an eligible asset on installation, with existing depreciation rules applying to the balance of the asset's cost.
Supporting apprentices and trainees
Eligible employers can apply for a wage subsidy of 50% of the apprentice's or trainee's wage for 9 months from 1 January 2020 to 30 September 2020. Where a small business is not able to retain an apprentice, the subsidy will be available to a new employer that employs that apprentice. Employers will be reimbursed up to a maximum of $21,000 per eligible apprentice or trainee ($7,000 per quarter).
Support will also be provided to the National Apprentice Employment Network, to co-ordinate the re-employment of displaced apprentices and trainees throughout their network of host employers across Australia.
Support for Coronavirus-affected regions and communities
The Government will set aside $1 billion to support regions most significantly affected by the Coronavirus outbreak. These funds will be available to assist during the outbreak and the recovery. In addition, the Government is assisting our airline industry by providing relief from a number of taxes and Government charges estimated to total up to $715 million.
There is also relief provided to child care providers, allowing working parents to access childcare for free.
There is also significant Federal assistance to the banking sector to allow for speedy access to lending. Please contact your bank for further details on how they can assist you,
We are also watching for the details on announcements from state governments on the measures they are introducing. You can register your own interest on their website here.
You can download the Current Overview or Summary page here.
Link here to the Federal Treasury Website.
We wish everyone the best in this difficult time and remind clients to stay safe.