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2020-04-02 16:55:21About Intuit / Company newsEnglishhttps://quickbooks.intuit.com/au/resources/au_qrc/uploads/2020/04/Covid19_update-graphic.pnghttps://quickbooks.intuit.com/au/resources/small-business-news/a-major-boost-for-small-business-from-the-federal-government/A Major Boost for Small Business from the Federal Government

A Major Boost for Small Business from the Federal Government

6 min read

This is a time of great uncertainty for all Australians and small businesses in particular. The situation is changing rapidly, with developments on both the health front and in the economy.

Fortunately, the government’s measures to spare the lives of Australians from the ravages of COVID-19 are also being complimented with steps to ensure small businesses survive this period too.

Australian Governments at all levels continue to announce a series of business-boosting stimulus measures to support business, as they face enforced closures or a drop in revenue as customers are required to stay indoors.

Update: On May 26th, Prime Minister Scott Morrison announced plans to make it easier for small businesses to hire appropriately skilled staff, through its JobMaker Plan.

The Prime Minister suggested this would be based on:

  1. The review and simplification of industrial relations awards that SMEs use to hire and pay staff;
  2. Linking vocational education training funding to skills shortages and other labour market trends.

The Prime Minister also signalled plans to reform the tax system to encourage jobs and investment, likely in the October budget.

Check back for further details on how your business could benefit as they are released.

Find out more about the government support available at a Federal level below.

What’s on offer from the Federal government

 

At the Federal level, help has come in the form of three major stimulus packages in three weeks, totalling an unprecedented $214 billion.

These business-boosting packages will make it easier to access capital, pay and keep staff, and cut costs and are set to limit a surge in unemployment and business insolvencies and prompt a faster economic recovery.

For many Aussie small businesses, the government’s recent stimulus package will be the news they’ve been waiting to hear, with 72 per cent believing government assistance and tax benefits are the best means of helping them persevere throughout the COVID-19 crisis.

Find an overview of the activity below:

Paying employees and keeping staff:

  • Fortnightly $1,500 JobKeeper payments
  • Wage subsidies for apprentices and trainees

Access to capital:

  • Cash flow assistance delivers one-off payments
  • Coronavirus SME Guarantee Scheme to improve access to working capital

Reducing costs:

  • Accelerate depreciation deductions and instant asset write-offs
  • Relief for tax payments

Protection for distressed businesses:

  • Temporary relief from insolvency demands

A deeper dive

Keeping employees on the books until businesses can come out the other side of the COVID-19 slowdown is key. The $1,500 JobKeeper payment is intended to offset the cost of meeting payroll for businesses that are significantly affected by the pandemic.

Learn if you’re eligible.

Register your interest.

Note: This benefit makes it more important than ever to be STP compliant. You can still become STP compliant before 1 May and access the JobKeeper payment. Find out how QuickBooks can help.

The government wants to help businesses keep apprentices and trainees on staff and is offering a big incentive. Some small businesses will be able to apply for a wage subsidy of half of the apprentice’s or trainee’s wage during the nine month period beginning 1 January 2020. Employers will be reimbursed up to a maximum of $21,000 per eligible apprentice or trainee ($7,000 per quarter).

Learn more and discover who is eligible.

Cash flow is always a challenge for small businesses and now more so than ever. The Government is providing up to $100,000 to eligible small and medium sized businesses, and not‑for-profits (including charities) that employ people. These payments will help businesses and not-for-profits keep operating, pay their rent, electricity and other bills and retain staff. Payments start at $20,000.

Learn more and discover who is eligible.

Note: To take advantage of these payments, you will need to lodge your BAS. If you’re eligible, it will be automatically triggered and delivered as credits in the ATO’s activity statement system after 21 April. To ensure you know what you’re eligible for, be sure to lodge your BAS online through QuickBooks.

In tough economic times, it can become harder to access loans when you need them most. The $40 billion Coronavirus SME Guarantee Scheme will involve government guarantees of up to 50 per cent of new loans issued to small businesses, improving banks’ willingness and ability to provide much-needed credit. This support small businesses to get access to funds that could help them get them through the impact of the coronavirus.

This complements other cuts to red-tape to allow small businesses to get access to credit faster, as well as announcements made by Australian banks to support small businesses with their existing loans.

Learn more and discover who is eligible.

Small businesses can use this allowance – worth $3.2 billion in total – to accelerate depreciation deductions on the purchase of certain new, depreciable assets.

Learn more and discover who is eligible.

The Australian Taxation Office (ATO) will provide administrative relief for certain tax obligations – similar to relief provided following the bushfires – for taxpayers affected by the coronavirus outbreak. For some, this could mean delays in paying income tax, GST, PAYG and more, or low interest payment plans to assist.

Learn more and contact the ATO for more information on your eligibility.

In a lifeline to those who may otherwise face going out of business as a result of COVID-19, the government will allow a temporary increase to the threshold at which creditors can issue a statutory demand on a company and the time companies have to respond to statutory demands they receive. This includes temporary relief for directors from any personal liability for trading while insolvent and providing other temporary flexibility. Relief is available for six months.

Learn more about how this might apply to your business.

Things to remember:

 

Many government staff are working remotely at this time and as a result we wouldn’t be surprised if some Intuit customers experience increased delays for online and phone enquiries for the foreseeable future.

While you’re waiting, have a read of our guides, tips and resources on how you can navigate the coronavirus crisis, or check out our blog on state support to learn more about what your state is doing to support small businesses.

If you’re looking for other assistance accessing this government support, keep an eye on this blog, contact your accounting advisor or use the QuickBooks portal to find one near you.

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Information may be abridged and therefore incomplete. This document/information does not constitute, and should not be considered a substitute for, legal or financial advice. Each financial situation is different, the advice provided is intended to be general. Please contact your financial or legal advisors for information specific to your situation.

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