Other Government Assistance and Tax Relief

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April 9, 2020

Traverse_Other-Government-Assistance

ATO Payment Relief

Overview

  • Variation of pay as you go instalment (PAYGI) to zero and claim a refund for instalments already paid for September and December 2019 quarters.
  • Deferring by up to 6 months the payment date of amounts due through the activity statement (including PAYGI), income tax assessments, fringe benefits tax assessments and excise
  • Allow businesses on a quarterly reporting cycle to change to monthly GST reporting in order to obtain quicker access to GST refund.

Pay As You Go Instalment Variations

PAYGI variations: March 2020 IAS/BAS

All taxpayers who currently pay PAYGI are eligible to vary down their March 2020 instalment notice to Nil. As part of the variation, instalments already paid for September and December 2019 quarters are eligible to be refunded back to the taxpayer. Noting this will mean all income tax will be due and payable upon lodgement of the 2020 tax return.

ATO Payment Deferrals

Deferral of ATO payment obligations: 6 months and interest not accrued from 23 January 2020

All entities will be eligible to access deferral of payment or favourable payment arrangements for current and new debts from activity statements (including PAYG instalments), income tax assessments and fringe benefits tax assessments and excise incurred with an interest free period from 23 January 2020.

Change in Activity Statement Reporting Cycle

Change of reporting cycle: next BAS

Businesses who currently report Activity Statements on a quarterly reporting cycle will be allowed to change to a monthly reporting cycle in order to obtain quicker access to GST refunds.This measure is relevant to importers OR Business who make GST–Free sales and incur a large value of input tax credits on purchases from business activities.

Other Government Assistance

Overview

  • Employers of Apprentices/Trainees may be eligible for a 50% subsidy for wages from January through to September 2020 up to $21K per Apprentice/Trainee
  • Accelerated depreciation for businesses with turnover more than $500m
  • Instant asset write offs of up to 150K for businesses with turnover less than $500m
  • Early access to Superannuation up to 20K over the next two quarters
  • Reduction in minimum annual drawdowns for account based pensions and annuities by 50%
  • NSW Payroll tax reduction of 25% for FY2020 with payment deferrals also available.Access to the JobSeeker payment through Centrelink has been simplified for those who are unemployed due to the Coronavirus
  • The Government will provide payment assistance for those with children in approved Child Care facilities from 6 April 2020
  • NSW Government small business support grant of $10,000 for businesses that have been subject to closure or are highly impacted by NSW Government health directives.

50% subsidy for apprentice wages

A wage subsidy of 50% for apprentice or trainee wages for up to 9 months from January 2020 to September 2020 will be available to small business employers.

  • If the employer is unable to retain the apprentice the subsidy is available to the new employer
  • Maximum benefit is $21,000 per apprentice or trainee
  • Available to small business employers employing fewer than 20 employees who retain an apprentice or trainee
  • Registrations open from 2 April 2020
  • Final claims are to be lodged by 31 December 2020
  • Applications are through the Australian Apprenticeship Support Network.

Accelerated depreciation

  • For businesses with <$500m turnover and not using simplified depreciation rules
  • 50% deduction of the cost
  • Existing depreciation rules apply to the balance
  • Asset must be installed and ready for use by 30 June 2021

Instant asset write off up to $150k

  • For businesses with <500m turnover
  • Asset must be installed and ready for use by 30 June 2020
  • Luxury car limit applies
  • Only applies until 30 June 2020

Early Access to Super

Up to $20,000 in superannuation can be accessed by Individuals under the COVID-19 early release package.

  • Access to $10,000 can be made before 1 July 2020
  • Access to a further $10,000 will be available from 1 July 2020 until 24 September 2020
  • Individuals must be one or more of the following to be eligible:
    • Unemployed, eligible to receive job seeker payment, youth allowance, parenting benefit, special benefit or farm household allowance.
    • On or after 1 Jan 2020 either:
      • Made redundant
      • Working hours reduced by >20%
      • Sole trader turnover reduced by >20%
  • Applications will be made through the ATO online services – note no evidence will be required for application, but needed in the event of audit

Reducing minimum pension drawdowns for SMSF

The Government has reduced the minimum annual payment required for account-based pensions and annuities from SMSF’s. The minimum annual payment required will be reduced by 50% for both the 2020 and 2021 financial years. If you have paid more than the minimum drawdown for the 2020 financial year you can recontribute these amounts if eligible to make super contributions, subject to the contribution cap.

Payroll tax

Payroll tax relief measures have been implemented across all states including details as follows:
NSW
  • Available for groups with taxable wages <$10m
  • Annual liability reduced by 20%
  • Done at time of annual reconciliation
  • March, April or May 2020 payment not required for monthly payers
  • Deferrals available for 6 months
QLD
  • Groups with <$6m in Australian taxable wages eligible for refunds of payroll tax for 2 months and payroll tax holiday for 3 months
  • Deferral of payroll tax for the 2020 calendar year
  • Groups with >$6.5m in Australian taxable wages eligible for deferral of payroll tax for 2020 calendar year and refund of payroll tax for 2 months
VIC
  • Groups with taxable wages <$3m payroll tax refund of first 3 quarters.
  • Last quarter no payment required.

Centrelink

We understand that due to the effects of the coronavirus some of you OR your employees may be in need of direct government assistance by way of Centrelink payments. We are unfortunately unable to directly assist with any claims in this regard. Please see the below link with further detail to assist in contacting Centrelink for the JobSeeker payment as well as Youth Allowance and the Parenting Payment. >  Affected by Coronavirus | If you need a payment – Coronavius (COVID-19)

Child Care

Child care will be free from 6 April until 28 June for all families with children in approved child care. This means that care will be available for children of essential employees and those that are keeping their children at home can hold their child care position and not be required to pay fees to do this.

NSW Government Small Business Support Grant

Applications will be open on the Service NSW website from 17 April 2020

The grant of $10,000 will be available to businesses who:

  • have between 1-19 employees and turnover > $75,000
  • payroll below $900,000
  • have at ABN and employ staff at 1 March 2020
  • be highly impacted by the Public Health (COVID-19 Restrictions on Gathering and Movement) Order 2020 issued on 30 March 2020
  • use the funding for unavoidable business costs such as utilities, overheads, legal costs and financial advice 
  • provide appropriate documentation upon application.

Stay tuned for more detailed information on the COVID-19 stimulus in the coming weeks.

Want to know more? Get in touch with one of the team for a comprehensive overview of what you’re entitled to. 

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