SPECIAL BUSINESS BULLETIN CORONAVIRUS (COVID – 19)
Possible Action Required: Assistance for your business to cope with the Coronavirus effects
As a business owner, you need to face the possibility of team members being absent from your workplace, product supply issues and demand for your services and products reducing over the short term.
There are 5 urgent things you need to be aware of:
1. Good advice is needed now more than ever
2. Government Stimulus Package – Our Tax Planning meeting with you this year will be VITAL!
3. ATO relief
4. Business Continuity Planning
5. Get your Will and EPOA updated / set up NOW
1. GOOD ADVICE IS NEEDED NOW MORE THAN EVER
If you have any queries or would like to have a meeting, please don’t hesitate to contact Graham or Keith on 9316 8700 or if you prefer request a Zoom meeting.
Business and Tax
The Australian Government has just released their $17.6 billion economic stimulus package in response to the Coronavirus. It is designed to help employers to keep their workforce levels. There are key tax benefits that business owners need to access over the next few months. Our expert accountants are here to help business owners receive the maximum benefits they can.
For any questions you may have about accounting, tax or business matters, please feel free to contact us at GFA.
The share markets have crashed due to fear and uncertainty in the marketplace. As has always happened before, when this crisis is over then the markets will quickly pick up again. Keeping a long term focus and not panicking now is the key to success.
If you would like some personal time to chat about this with Graham Finch please call to arrange.
2. GOVERNMENT STIMULUS PACKAGE – OUR TAX PLANNING MEETING WITH YOU THIS YEAR WILL BE VITAL!
The Australian Government has just released a $17.6 billion economic stimulus package. The package has been marketed as a measure to protect the economy by maintaining confidence, supporting investment and keeping people in their jobs.
The key tax and stimulus measures include:
- From Thursday 12 March 2020, the instant asset write-off threshold has been increased from $30,000 (for businesses with an aggregated turnover of less than $50 million) to $150,000 (for businesses with an aggregated turnover of less than $500 million) until 30 June 2020.
- A time-limited 15-month investment incentive (through to 30 June 2021) which will operate to accelerate certain depreciation deductions. This measure will also be available to businesses with a turnover of less than $500 million, which will be able to immediately deduct 50% of the cost of an eligible asset on installation, with existing depreciation rules applying to the balance of the asset’s cost. As announced, this measure is proposed to only apply to new depreciating assets first used, or installed ready for use, by 30 June 2021.
- Tax-free payments of up to $25,000 for eligible small and medium businesses (i.e., with a turnover of less than $50 million that employ staff) based on their PAYG withholding obligations. This is not a cash payment, but it is a credit equal to 50% of the PAYG amounts withheld from salary and wages paid to employees.
- Businesses that lodge activity statements on a quarterly basis will be eligible to receive the credit for the quarters ending March 2020 and June 2020. Business that lodge on a monthly basis will be eligible for the credit for the March 2020, April 2020, May 2020 and June 2020 lodgements.
- If a business pays salary and wages to employees but is not required to withhold any tax, then a minimum payment of $2,000 will still be made. The minimum $2,000 payment will be applied to the first activity statement lodgement.
- Wage subsidies to support the retention of apprentices and trainees – Employers with less than 20 full-time employees may be entitled to apply for Government funded wage subsidies amounting to 50% of an apprentice’s or trainee’s wage for up to nine months from 1 January 2020 to 30 September 2020. The maximum subsidy for each apprentice/trainee is $21,000.
- Tax-free payments of $750 to social security, veteran and other income support recipients and eligible concession card holders. It is estimated that around half of those who will benefit will be pensioners. These payments will commence to be automatically made from 31 March 2020.
When we have our 2020 Tax Planning meeting with you over the next few weeks, we will assist you with opportunities to restructure how you pay yourself to that you can receive the maximum cashflow assistance amounts from the Government.
Contact us TODAY if you would like to meet with us earlier to ensure you receive your maximum cashflow assistance from the Government.
3. ATO RELIEF
On 12 March 2020, the Australian Taxation Office (ATO) announced a series of administrative concessions to assist businesses impacted by COVID-19, which include:
- deferring by up to 4 months the payment of tax amounts due through the BAS (including PAYG instalments), income tax assessments, FBT assessments and excise by affected businesses;
- allowing affected businesses on a quarterly reporting cycle to opt into monthly GST reporting to get quicker access to any GST refunds;
- allowing affected businesses to vary PAYG instalment amounts to zero for the April 2020 quarter. Businesses that vary their PAYG instalment to zero can also claim a refund for any instalments made for the September 2019 and December 2019 quarters;
- remitting any interest and penalties, incurred by affected businesses on or after 23 January 2020, that have been applied to tax liabilities; and
- allowing affected businesses to enter into low-interest payment plans for their existing and ongoing tax liabilities.
The ATO assistance is not automatic, taxpayers must first contact the ATO to request assistance, and if eligible, the ATO will ‘tailor the assistance package for the relevant taxpayer.
Legislation to give effect to these measures will be introduced into Parliament, which resumes on 23 March 2020. It is expected that it will be passed urgently. As certain incentives in the economic package will only be available for a short period of time, businesses should consider taking action as soon as practicable.
4.BUSINESS CONTINUITY PLANNING
As a business owner, now is the time to plan for employees being away from your workplace, shortages of supply, reduction in sales, and the possibility of your workplace being closed for a short period of time if every is being forced to self-quarantine.
Over the next few weeks, we would like to meet with you or have a Zoom Meeting to discuss the following: Employees working from home, and workplace obligations
- How do pay your bills in the short term if your sales start to dry up
- How to communicate in a reassuring way with your clients and customers
- How to keep things moving with your business
We’re not suggesting in any way that we have all the answers, but it is important for us to work with you and help you and plan for what will happen in the weeks and months ahead.
Contact us to book in a 30 minute Zoom online meeting so we can discuss your business situation and make plans to assist you.
5. GET YOUR WILL AND EPOA UPDATED / SET UP NOW
If you have to self-quarantine or are admitted to hospital, if you don’t have an EPOA then no-one else can make important business or financial decisions on your behalf.
As a business owner, it is 100% essential that you have an up to date EPOA and Will, and that your family know where these are stored.
If you would like assistance with this please contact our office.