Small and medium businesses (SMBs) in Australia have found it difficult to retain staff during the economic downturn associated with COVID-19.
In response, the Australian Tax Office (ATO) has launched a cash flow boost scheme to reduce financial pressures on smaller businesses.
Launched on 12 March 2020, the scheme was designed to support SMBs and improve business confidence.The payments were aimed at improving cash flow so SMBs can keep operating as usual, pay their bills, and retain their workforce.
It is expected that this measure will help around 690,000 businesses employ around 7.8 million people and around 30,000 not-for-profit organisations (NFPs) including charities.
The key takeaway is that eligible businesses and NFPs that employ staff are entitled to tax-free cash boosts of between $20,000 and $100,000.
If you are eligible, all you have to do as a small business owner is lodge your monthly or quarterly business activity statements (BAS) as usual.
You’ll then receive the cash flow boost in two instalments as credits in the ATO’s activity statement system.
But how do you know if you are eligible, and how will the payments work? Let’s explore this further.