COVID -19 RESOURCES AND ASSISTANCE SUMMARY FOR INDIVIDUALS AND SMALL TO MEDIUM BUSINESSES (Last updated 11/8/2020)

 

The information contained in this article is for general reference only.  For concessions and assistance specific to your business and  for further detail on how to access those concessions, please speak to your LBW account manager or contact our reception on 03 5221 6111 to arrange a time to discuss with one of our professional staff.

We are updating this resource page daily, but due to the frequency of updates coming out from the Federal and State Government, the Australian Taxation Office and relevant businesses, please contact your LBW Business + Wealth Advisors representative to discuss what is available

See here for the main ATO page that links to the various stimulus items described below

INDIVIDUALS

BUSINESS (FEDERAL GOVERNMENT)

AUSTRALIAN TAXATION OFFICE

BUSINESS (VICTORIAN STATE GOVERNMENT)

BANKING

OTHER


INDIVIDUALS

 Assistance Item

 Detail, eligibility and key dates

JobSeeker Payment

&

JobSeeker Supplement

 
  • Up to $1,100 payment per fortnight income support (time limited) combined JobSeeker Payment and JobSeeker Supplement
  • Existing and new recipients of Jobseeker Payment, Youth Allowance Jobseeker, Parenting Payment, Farm Household Allowance and Special Benefit can access
  • Paid for 6 months
  • Not subject to assets test
  • temporarily relaxed partner income test
    • personal income test still applies
  • Supplement is $550 and payment based on eligibility for JobSeeker Payment (previously Newstart)
    •  If you are in receipt any JobSeeker Payment amount (even as little as $1) you are eligible for the whole $550 Jobseeker Supplement
  • Not tax free

Confirmed that Austudy and Abstudy recipients are eligible

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JobSeeker 2.0

(post 27 September 2020)
  • The JobSeeker Supplement (currently $550 a fortnight) will reduce to $250 a fortnight from 25 September 2020 until 31 December 2020
  • Automatically received if you are eligible for the JobSeeker Payment (thew old Newstart Allowance)
  • From 25 September the following tests will be reintroduced:
    • Asset Test
    • Liquid Assets waiting period
  • The Ordinary Waiting Period, Newly Arrived Resident's Waiting Period and Seasonal Work Preclusion Period will continue to be waived until 31 December 2020
Action:
Automatic for existing recipients of Jobseeker Payment. Refer here for eligibility criteria
References:
Income Support for Individuals (29/7)

Two payments of $750

 
  • The first $750 payment from 31 March 2020 and the second $750 from 13 July 2020
  • Social security, Veteran and other income support recipients and eligible concession card holders
  • Second Payment not provided to those eligible for the Coronavirus supplement (the $550 payment above)
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Action:
Automatic
References:
Payments to support households (29/3)

Early Release of Superannuation

 
  • Case by case
  • Release up to $10,000 from superannuation in 2019/2020
  • A further $10,000 from 1 July 2020 to 30 September 2020
  • Demonstrate financial distress
  • Tax free
  • Will not affect Centrelink or Veterans affairs payments
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Action:
Upon application. Speak to your advisor. Refer here for further information on eligibility and application process
References:
Early Access to Superannuation (23/7)

Reduction in

Drawdown Rates

  • Temporary reduction in minimum drawdown rates by 50% for account based pensions for 2019/2020 and 2020/2021 to reduce the need to sell investments to fund minimum drawdown requirements
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Action:
Speak to your advisor
References:
Providing Support for Retirees (25/3)

 Job Keeper

 
  • Applies to full time, part time and casual staff
  • Students 17 and younger not generally eligible
  • Employee eligible to receive this payment from one employer only
  • Casuals to have worked more than a year on a regular and systematic basis
  • Casuals are not eligible if they  are a permanent employee of another employer
  • Self employed individuals also eligible
  • JobKeeper payment is reportable income (affects other centrelink payments)
  • Employer required to advise employees that he has nominated them as eligible employees
  • Employer to pay at least $1,500 per fortnight and seek reimbursement under the JobKeeper provisions on a monthly basis.
  • JobKeeper will only be paid on a reimbursement basis
  • ATO have stated they will be flexible in eligibility assessment
  • Employer to speak to the ATO monthly
  • Turnover less than $1 billion
    • Turnover to have decreased by greater than 30% 
  • Turnover greater than $1 billion
    • Turnover to have decreased by greater then 50%
  • Turnover decline is measured by referring to a comparable period a year ago (of at least 1 month) as reported on BAS'
  • Potentially employers expected to "top up" to normal wage
  • JobKeeper payment available for 6 months
    • This has now been extended - refer to JobKeeper 2.0 below
  • For employees on the books on 1 March and employee is retained or continues to be engaged by the employer
    • For the last 4 JobKeeper fortnights (and for JobKeeper 2.0) commencing 3 August 2020, the employee start date eligibility changed to 1 July 2020 (previously 1 March)
    • Casuals still need to be employed for 12 months on a regular and systematic basis as at 1 July to be eligible.
  • If business is non operational because of government directive, employer (and employee) can still receive the payment
  • People paid via dividends and trust distributions can access JobKeeper (one only) Refer to FAQ below
  • Where you are eligible for the  JobKeeper you cannot claim the $7,000 per quarter  Apprentice Subsidy (see below)
  • Deadline for April fortnight payments to employees is 8th May
  • Enrolment deadline for April fortnights is 31 May
  • May fortnight payments to be made within the relevant fortnight

 

  • Alternate Turnover Test:
    • For businesses without a comparable period to compare turnover in assessing eligibility to the JobKeeper program the government has release the Alternate Turnover Test.
    • Refer here for information on the Alternate Turnover Test (the Rules and Explanatory Statement).
    • Please contact your LBW representative if you need assistance in applying the Alternate Turnover Tests
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Action:
Employer to apply for through ATO (www.ato.gov.au)
Program commences 30 March.
Pay employees by 8th May for April fortnights
Enrol by 31st May
References:
LBW - JobKeeper Enrolment and Application Process
LBW - JobKeeper Enrolment Procedures and Payroll Considerations
JobKeeper Payment (7/8)
FAQ (26/6)
Protecting Integrity (7/8)
 
 
ATO JobKeeper Information (11/8)
Changes to the Fair Work Act (Treasury) (7/8)
Changes to the Fair Work Act (Fair Work Ombudsman) (11/8)
ATO Alternate Turnover Test Information (11/8)
 

JobKeeper 2.0

(post 27 September 2020)
  • Commences 28 September
  • Available to eligible businesses including the self employed and NFP
  • Runs until 28 March 2021 in two separate tranches
  • Employee eligibility date moves from 1 March to 1 July
  • First tranche:
    • 28 September 2020 to 3 January 2021
    • $1,200 per fortnight for full time employees
    • $750 per fortnight for employees (part time and casual) who worked less than 20 hours in the relevant reference period
    • Actual GST turnover to be used to demonstrate greater than 30% decline in turnover
    • Eligibility based on decline in turnover comparing September 2020 actual quarter to September 2019 actual turnover
    • Presents a timing issue in that September quarter BAS will need to be completed with a few days of quarter end to determine eligibility based.
  • Second Tranche
    •  4 January 2021 to 28 March 2021
    • $1,000 per fortnight for full time employees
    • $600 per fortnight for employees (part time and casual) who worked less than 20 hours in the relevant reference period
    • Actual GST turnover to be used to demonstrate greater than 30% decline in turnover
    • Eligibility based on decline in turnover comparing December 2020 actual quarter to December 2019 actual turnover
    • Presents a timing issue in that December quarter BAS will need to be completed with a few days of quarter end to determine eligibility based.
  • The commissioner may extend the deadline to meet the wage condition (paying the minimum for reimbursement) for the first fortnight in each tranche to enable employers the ability to assess turnover eligibility.
  • Alternative tests can be set by the Commissioner presumably similar to those alternative tests set out in JobKeeper 1.0 - no detail released as yet
  • Employee Eligibility and payment rate
    • First Tranche:
      • $1,200 per fortnight for employees who work 20 or more hours a week in the business on average (or business participants who were actively engaged in the business for 20 hours or more on average) in the 4 weeks of pay periods before either 1 March 2020 or 1 July 2020
      • $750 per fortnight for other eligible employees and business participants
      • You can choose that reference time which suits best (1/3/20 or 1/7/20) if the employee was employed prior to March 1 and continues to be employed throughout the JobKeeper period. If the employee commenced post 1 March 2020, the pay periods prior to 1 July are the reference periods that need to be used
      • Casual employees will need to be employed for at least 12 months as at 1 July 2020 on a regular and systematic basis and not a permanent employee of another employer
    • Second Tranche
      • $1,000 per fortnight for employees who work 20 or more hours a week in the business on average (or business participants who were actively engaged in the business for 20 hours or more on average) in the 4 weeks of pay periods before either 1 March 2020 or 1 July 2020
      • $650 per fortnight for other eligible employees and business participants
      • You can choose that reference time which suits best (1/3/20 or 1/7/20) if the employee was employed prior to March 1 and continues to be employed throughout the JobKeeper period. If the employee commenced post 1 March 2020, the pay periods prior to 1 July are the reference periods that need to be used
      • Casual employees will need to be employed for at least 12 months as at 1 July 2020 on a regular and systematic basis and not a permanent employee of another employer
    • The commissioner will set out alternative tests where the reference periods (4 weeks of pay periods prior to 1 March or 1 July are not usual for the purposes of assessing employee eligibility and payment rate
  • Payment will continue to be on a reimbursement basis (in arrears)
  • Turnover threshholds are same as original JobKeeper (30% for less than $1 Billion turnover, 50% for greater than $1 Billion turnover)
  • Other conditions/threshholds are same as the original JobKeeper
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Action:
Contact your LBW representative
References:
JobKeeper Extension (10/8/2020)

Homebuilder

 

  • $25,000 grant paid directly to eligible owner occupiers (not just first home buyers)
  • For the purpose of building new homes or substantial renovations
  • Owner occupiers must apply as individuals, not a company or trust
  • Be an Australian citizen aged over 18
  • Building contracts entered into between 4 June 2020 and 31 December 2020
    • Work must commence with six months of contract date
  • Threshholds:
    • Meet two income caps:
      • single earning less than $125,000
      • couples earning less than $200,000
      • based on 2018/2019 taxable incomes
    • New home less than $750,000 including land
    • Substantially renovate existing home as a principal place of residence with renovation cost between $150,000 and $750,000
      • home valued at less than $1,500,000 prior to renovations
  • Building work undertaken by licensed building contractor
    • Builder cannot be a relative of the property owner
  • Renovations can be a combination of works (kitchen, bathroom etc)

 

  • If eligible, can also access:
    • First Home Home Owner Grant
    • Stamp Duty concessions
    • Commonwealth First Home Loan Deposit Scheme
    • First Home Super Saver Scheme

What isn't allowed:

  • Renovations must improve the accessibility, safety and liveability of the home.  It cannot be used for swimming pools, tennis courts, outdoor spas and sauna, detached sheds or garages
  • Owner-builders and people seeking to build a new home or renovate an existing home as an investment property are ineligible
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Action:
Speak to your Advisor
References:
Treasury Fact Sheet (18/6)
Treasury FAQ (4/8)

 

BUSINESS - FEDERAL GOVERNMENT

 Instant Asset Write off

 
  • Instant Asset Write off increase from $30,000 to $150,000 (GST Excl)
  • Aggregated turnover less than $500 million
  • First used or installed ready for use before 31 December 2020
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Action:
Speak to your advisor
References:
Delivering Support for Business Investment (21/7)

 Accelerated Depreciation

 
  • Accelerating Depreciation Deductions by allowing 50% deduction for eligible assets on installation, with existing depreciation rules applying to balance of the asset's cost
  • Aggregated turnover less than $500 million
  • First used or installed ready for use before 30 June 2021
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Action:
Speak to your advisor
References:
Backing Business Investment (1/4) (page 3 Fact Sheet)
 

Cash Boost (PAYG Withholding Credit)

 
  • Two Tax Free rebates/credits from between $10,000 and $50,000 each for PAYG withheld for small and medium sized businesses and NFPs (increased from between $2,000 and $25,000)
    • Note that although labelled as tax-free (NANE income) where the Cash Boost is received by a company there will likely be tax payable on this amount in the hands of the shareholders either through Division 7 or though unfranked dividends, and in a unit trust may result in erosion of the unit holders cost base.
  • Aggregated turnover less than $50 Million based on prior financial year turnover)
  • Certain lodgement requirements (see weblink below)
  • Payment 1 - 100% of PAYG Withholding from 1 January to 30 June 2020 (max $50,000, min $10,000)
  • Payment 2 - 100% of Payment 1 if still an active employer (max $50,000, min $10,000). Need W1 in June BAS/IAS
  • NFPs now eligible as well
  • Available only to active eligible employers established prior to 12 March 2020
  • Thought not eligible for PSI entities
  • ATO indicating generally if a refund is due because of this mechanism they will not offset the refund against existing debt
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Action:
Automatic credit on BAS' and IAS' from March 2020 onwards
Speak to your advisor about specific timing of payments
References:
Cashflow Assistance for Business (2/4) 
 

 Apprenticeship Subsidy (including Extension)

 
  • Eligible employers apply for 50% of apprentices wage for 9 months
  • Aggregated turnover less than $50 Million
  • 9 months (1 Jan 2020 to 31 March 2021)
  • Maximum $7,000 per apprentice per quarter
  • Less than 20 employees (originally). Extension from 1 July to 31 March less than 200 employees
  • Apprentice in-training or employed  as at 1 March 2020
  • Register from early April 2020, latest December 2020
  • By reimbursement mechanism
  • Not available to employers receiving the JobKeeper Payment

 

Read the Treasury Release linked below for more detail

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Action:
First contact for subsidy is at AASN but application generally through the entity used to employ the apprentice (eg: MEGT)
References:
Supporting Apprentices and Trainees (29/7)

 Solvency Considerations

 
  • Temporarily Increasing threshhold at which creditors can issue a statutory demand against a company and to initiate bankruptcy proceedings against an individual. Additional time to respond to statutory demands.
  • Temporary relief from directors from any personal liability for trading while insolvent
  • ATO will tailor solutions for owners or directors of business
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Action:
Speak to your advisor
References:
Temporary relief for Business (21/4)
 

Government backed lending 

 
  • The Government will provide a guarantee for 50% to eligible lenders to support new short term unsecured loans to SMEs
  • $20 billion worth of guarantee on loans (so $40 billion of loans)
  • Starting in early April 2020
  • Include up front 6 month freeze on repayments
  • unsecured loans for working capital only
  • Up to $250,000 over three years
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Action:
Speak to your advisor
References:
Supporting the Flow of Credit
  

APRA changes to lending criteria 

  • Providing temporary exemption from Responsible Lending obligations for lenders providing credit to existing small business customers
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Action:
Speak to you advisor and your lender
References:
Department of Treasury and Finance

Commercial Rent Relief

 
  • States and Territories to implement mandatory Code of Conduct (incl legislation) to impose a set of good faith leasing principles to commercial tenancies where the tenant:
    • is a small-medium sized business (annual turnover less than $50 million
    • is an eligible business for the JobKeeper program
  • Proportional rent reductions based on tenants decline in turnover to ensure that the burden is shared between landlords and tenants. Combination of deferral and waiver of rent with deferrals to be less than 50% of reductions
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Action:
Refer to here for Vic Government response.  Legislation passed 23/4 to enable Commercial Rent Relief Principles below
References:
Commercial Rent Relief Principles (Federal Code) 
Victorian rent relief process (29/5)
  

 RBA Lending backing for ADIs

 
  • The Reserve Bank is establishing a $90 billion facility to offer 3 year funding to authorised Deposit Taking Institutions (ADIs) to:
    • reduce interest rates for borrowers
    • to encourage financial support for borrowers mainly small to medium enterprises
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Action:
Speak to your advisor and your bank
References:
Reserve Bank of Australia
Department of Treasury and Finance

 

BUSINESS - AUSTRALIAN TAXATION OFFICE

 ATO Liability deferral

 
  • Deferral by up to 6 months the payment of amounts due through BAS, income tax assessments, FBT and Excise
  • Case by case but not automatic
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 Swap BAS reporting periods

 
  • Businesses can swap from quarterly to monthly in order to get quicker access to GST refunds
  • Case by case but not automatic
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Vary PAYG Instalments

  • Businesses to vary PAYG instalments to zero for quarter ended March 2020.  Those that do this can also claim a refund for PAYG instalments made on September 2019 and December 2019 BAS
  • Case by case but not automatic
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Interest and Penalty concessions

  • Remitting interest and penalties incurred after 23 January 2020 and that have been applied to tax liabilities
  • Case by case but not automatic
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Decrease in GIC

  • Low interest payment plans for existing ATO debt 
  • Case by case but not automatic
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Action:
Speak to your advisor and your bank
References:
Australian Taxation Office (information on above)
ATO hub for ALL COVID-19 information and processes

 

BUSINESS - VICTORIAN STATE GOVERNMENT

 Payroll Tax Refund

 
  • Full payroll tax refunds for the 2019/2020 financial year to small and medium business and no further payments for the balance of the 2019/2020 financial year
  • Payroll less than $3 million annual taxable wages (not aggregated)
  • Must continue to lodge Payroll Tax Returns
  • Make sure your bank details are updated on the SRO website
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Defer 20/21 Payroll Tax

 

  • Defer payments for first 3 months of the 2020/2021 financial year until 1 January 2021
  • Payroll less than $3 million annual (not aggregated)taxable wages
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Commercial tenant in Government Building

  • Commercial tenants in government buildings can apply for rent relief immediately
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Land tax payments for 2020 will be deferred

  • Eligible landowners that have at least one taxable non-residential property and total taxable landholdings below $1 million
  • Deferred until after January 2021
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Liquor licensing

  • Giving workers who have lost their job a fresh in agriculture and ensuring primary producers have they workers they need
  • $50 million Agriculture Workforce Plan (part of $500 million Working for Victoria Fund)
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Working For Victoria 

  • The $500 million Working for Victoria initiative helps Victorians, including people who have lost their jobs due to the economic impacts of coronavirus (COVID-19), find new work opportunities.
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Action:
Speak to your advisor
References:
Working For Victoria
Victorian Government CoronaVirus Business Support

$10,000 Grant

 
  • $10,000 grants available for 30,000 Victorian Businesses
  • Small business with less than $650,000 annual taxable wages (under the payroll tax threshhold)
  • Turnover more than $75,000
  • Initially for businesses that have been subject to closure or is highly impacted by Non-Essential Activity Directions (see here)
  • Expanded on 1 May to include all Businesses eligible for JobKeeper with payroll less than $650,000 except for sole traders (see here)
  • Closes 31 May 2020
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Action:
Register your interest here
References:
FAQ's here
 

 

BANKING

 Banking/Lending support  
  • All major banks are currently offering different support packages for business customers, including:
    • pausing loan payments
    • significant rate cuts
    • increased deposit rates
  • APRA will lower banks capital ratios to allow further lending
  • Refer to the Australian Banking Industry website (see below) for more information
    • Different offerings from different banks
    • Mostly for small businesses
  • Finance providers (HP/Chattel Mortgage) will also assist with deferrals
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Action:
Register with your Bank or Finance provider and speak to your Advisor
References:
Australian Banking Industry
 

 

TIPS AND CONSIDERATIONS

 Suppliers

 
  • Understand your supply chains
  • Explore alternative suppliers (where available) if product delivery is interrupted

 Customers

 
  • Is e-commerce an option or "stop gap" to keep business trading
  • Develop different methods of servicing customers
    • video conference/consultation
    • no contact delivery
    • take away rather than eat in
    • survival packs
    • operating hours
    • etc

Reporting

  • Review or develop budgets
  • Convert to cashflow budgets including receipts, payments, BAS/IAS, taxes and any capital expenditure (if any)
  • Don'tassume automatic approval of deferring ATO payments as per the concessions outlined above
  • Talk to your LBW advisor about how the other concessions will affect you
  • Stress test the budgets for different levels of income/receipts
  • Identify non core expenses to reduce

Talk to key stakeholders

  • Banks - financial hardship concessions
  • Employees
  • Suppliers (renegotiate terms)
  • Debtors (incentives to pay etc)
  • Rent holidays from Landlords
  • and so on

Insurance

  • Review business continuity insurance

Staffing

  • Review mix of staff (full time/casual)
  • Cross-skilling where necessary
  • Working from home
  • Review staff entitlements
  • Consider altering employment conditions and awards (specialist advice needed here so as not to breach Fair Work Act - See Above)

Solvency

  • Better reporting to ensure not trading whilst insolvent

When time permits

Once you have dealt with all that you can, managed what you can manage, consolidate what you can consolidate and rationalised what you can rationalise - take a breath and look at what you've done.

Your business will not look the same as it used to be. But unfortunately it doesn't stop there.  You will need to do this frequently over the coming months. To survive it will be necessary to continually shape and reform your business.  For some more than others.

At the end of every change and when you get to the end, and a lot of you will, take another look and see what you can keep out of the changes you have made.

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