How The COVID-19 Stimulus Package Could Help Your Small Business
On the back of the World Health Organisation declaring the coronavirus a pandemic, the government has unveiled a stimulus package to help small and meduim businesses.
The package will see the government inject $700 million to increase the instant asset write-off threshold, rising from $30,000 to $150,000. Access to the write-off will also be expanded to include businesses with aggregated annual turnover of less than $500 million, up from $50 Million. But the increase will only run until 30 June 2020.
Business that pay salary and wages with a turnover of less than $50 million will receive payments of up to $25,000 tax-free, with a minimum payment of $2,000 – even if they are not required to withhold tax. This measure will be delivered by the ATO as a credit in the Activity Statement system from 28 April 2020 once businesses lodge unpcoming activity statements.
The measures will have a start date from 12 March but will be subject to the passage of legislation.
The ATO has also announced a number of administrative relief measures to help businesses over the following months. This will include up to a four-month deferral of the payment date of amounts due through the business activity statement, including PAYG instalments, income tax assessments, fringe benefits tax assessments and excise.
Quarterly GST reporting businesses will be able to opt into monthly GST reporting in order to get quicker access to GST refunds they may be entitled to, and will be allowed to vary pay-as-you-go (PAYG) instalment amounts to zero for the April 2020 quarter.
The ATO will allow affected businesses to pay their existing and ongoing tax liabilities by allowing them to enter into low-interest payment plans and will look to remit any interest and penalties incurred on or after 23 January 2020.
Assistance measures for those impacted by COVID-19 will not be automatically implemented unlike the bushfire relief measures, which applied automatically to particular geographic areas. Instead, businesses will need to contact the ATO on its 1800 806 218 Emergencey Support Infoline to discuss their situation.
If COVID-19 has affected your business, let us know and we can assist you by contacting the ATO on your behalf to implement these measures.