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COVID-19 RELIEF MEASURES BY FEDERAL AND STATE GOVERNMENTS OF AUSTRALIA

Date: April 1, 2020
Categories: Others

 

The Federal Government and State Governments of Australia have announced various COVD-19 Relief measures. Here is a summary of those measures.

 

STIMULUS PACKAGE FOR INDIVIDUALS &HOUSEHOLDS

 

Support for Individuals and Households

  • Temporary expansion for 6 months, the eligibility to Income Support Payments.
  • Establishing a new, time limited Coronavirus supplement of $550/fortnight to both existing and new recipients of Job Seeker, Youth Allowance, Parenting, Farm Household Allowance and Special Benefit Payments.
  • 2 separate payments of $750 each to social security, veteran and other income support recipients and eligible card holders.
  • First payment to be made from 31st March 2020 and the second payment from 13th July 2020.
  • Half of the beneficiaries from these payments will be pensioners.
  • The beneficiaries of Coronavirus supplements are not eligible for the second payment of $750.

 

Job Keeper Payment

  • Subsidy of $1,500/fortnight/employee to employers and self-employed individuals (businesses without employees).
  • No limit on the number of employees and the effect of this is backdated from 1st March 2020.
  • This also extends to employees who stood down and re – hired at 1st March 2020.
  • Employees can be full time, part time or long-term casuals.
  • Employees are to be at least 16 years of age.
  • To be eligible for the payment, an employer must experience a significant decline in turnover, based on the following thresholds:

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Early Access to Superannuation and Reduction in Minimum Drawdown Rates

  • Temporary measures to allow early access to superannuation.
  • Individuals affected by Coronavirus can access up to $10,000 of their superannuation in FY2019-20 and a further $10,000 in FY2020-21.
  • Tax need not paid on the above drawdown amounts.
  • The above drawdown amounts will not affect Centrelink or Veterans’ Affairs Payments.

 

Reduction in Social Security Deeming Rates

  • The upper deeming rate to be 2.25% and the lower deeming rate to be 0.25% by 1st May 2020.
  • This reduction will benefit around 900,000 income support recipients, including 565,000 Age Pensioners.
  • Age Pensioners to receive $324 more.

 

STIMULUS PACKAGE FOR BUSINESS

 

Cash Flow Assistance

  • Small and Medium Sized Businesses and Not for Profits Organizations to receive a temporary ‘Tax Free Cash Flow Boost’.
  • An automatic payment or credit to be applied on the forthcoming Activity Statements.
  1. The Cash Flow Boost to be a minimum of $20,000 and a maximum of $100,000 for the businesses with aggregated turnover of less than $50 million and having employees.
  2. Quarterly Payers – 100% of PAYG Tax Withheld on Salary/Wages for the quarter ending 31st March 2020 and 30th June 2020 subject to the maximum limit of $50,000/quarter.
  3. Monthly Payers – 300% of PAYG Tax Withheld on Salary/Wages for the months commencing from January 2020 to June 2020 subject to the maximum limit of $50,000/quarter.
  • These payments to be available only to active eligible employers established prior to 12th March 2020.
  • Charitable Organizations are eligible for these payments regardless of their registration.

 

Increased Instant Asset Write off

  • Increase in the instant write off of assets from $30,000 to $150,000.
  • The above concessions are available for all assets regardless of whether they are new or second hand.
  • Applies for assets used or installed and ready for use from 12th March 2020 to 30th June 2020.
  • The turnover threshold limit to avail this benefit during the specified period will be $500 Million.

 

Accelerated Depreciation

  • 50% accelerated depreciation for assets costing over $150,000 (which are not eligible for instant write off).
  • Applies to assets acquired from 12th March 2020 to 30th June 2021.
  • This doesn’t apply to secondhand assets.
  • The turnover threshold limit to avail this benefit during the specified period will be $500 Million.

 

Wage Subsidy for Trainees and Apprentices

  • 50% of the wages paid to trainees/apprentices for the period from 1st January 2020 to 30th September 2020 to be paid as subsidy.
  • Applies to Small Businesses with less than 20 full time employees.
  • Subsidy to be restricted to $7,000/quarter and maximum of $21,000 overall during the 9 months period.

 

ATO Administrative Relief – Available Option

  • Deferring the tax payment by up to 6 months through the Business Activity Statements.
  • Switching over to monthly BAS reporting instead of quarterly reporting to gain quicker access to GST refunds.
  • Varying the PAYG Income Tax Installments for March 2020 and June 2020 Activity Statements and claiming refunds for the installments paid along with September 2019 and December 2019 Activity Statements.
  • Affected businesses can enter low interest payment plans.

 

STATE  AND  TERRITORY  TAX  RELIEF  MEASURES

 

Payroll Tax