As the current economic environment is drastically changing each day, we aim to keep you informed of the incentives and measures the Australian government is putting in place to assist Australians during this time.
Here is breaking news of the latest stimulus measures that the Government has announced this afternoon, which is fantastic news for small businesses and working Australians. We have also included a a re-cap of all measures that are already in place.
THIRD STIMULUS PACKAGE – 30 MARCH, 2020
1. Enhanced wage subsidy: Breaking news today is that the Government has announced a $130 billion “job keeper” subsidy in the next six months to try to keep Australians in work and keep Australian businesses in business.
The Government is providing cash payments to eligible small-medium sized businesses through a wage subsidy of $1500 per employee per fortnight for up to 6 months.
The payments apply to employees who were employed before 1 March 2020 and are full-time, part-time, casual employees who have been with their employer for at least 12 months, sole traders and New Zealanders on 444 visas. Payments will begin the first week of May and will be backdated to today.
Eligible businesses are those whose revenue has fallen by 30 per cent or more, or in the case of a business with an annual turnover of more than $1 billion, by 50 per cent or more.
2. Rent relief for tenants (both residential and commercial): The Federal government has left it to each State to determine their own policy and rent relief packages, which are still being determined and likely to differ for residential and commercial. What is clear is now is that there will be a moratorium in NSW on eviction of commercial and residential tenants who have experienced financial hardship due to Coronavirus until the end of September (at least).
The government is encouraging tenants and landlords to discuss relief arrangements directly and where relevant to involve the landlord’s bank in these discussions. From what we are seeing amongst our wider client base, most tenants are already doing this. It is to be hoped that in the coming week, there will be a clear direction from the NSW Government on what rent relief will be provided and how these changes will be applied. While we are confident this announcement will cover residential tenancies, we are less certain that there will be an announcement about commercial tenancies, with the prospect that the Government may just leave it to tenants, landlords and banks to sort out.
Click here to review the specific details of the latest stimulus measures announced this afternoon as outlined above.
We have also created a summary for you of all the measures that have previously been announced:
PAYROLL TAX
The NSW Government (like all State Governments) announced a payroll tax relief package by putting a freeze on payments for the months of April to June. This has been available for employers with under $10million in annual wages. Over the weekend, this relief was increased to cover all employers and to also cover the months of July to September.
It is unclear if the freeze also covers payroll tax for the month of March, so we are suggesting for all clients to hold off payment until this becomes clear. You are however still required to lodge all monthly payroll tax returns.
We understand that the method that Office of State Revenue (OSR) will be applying, will be to calculate your payroll tax for the 2019/2020 year and then apply a 25% discount to this amount. If the amount payable is less than the monthly payroll tax you have already paid through the year then you will receive a refund. Given most employers will have lower payroll in the April to June period than they had in earlier months, it is most likely that you will receive a refund even if the March payroll tax has not been paid.
If you have business activity in another State please contact your Allan Hall advisor and they can assist you to understand the relief package provided in that State.
LAND TAX
Many property owners are going to face the prospect of nil or reduced rent, but still having a liability for land tax. At this stage there has been no announcement by the NSW Government on land tax relief.
If you have land tax assessments or instalments due, we recommend that you contact your Allan Hall advisor to discuss whether you should pay them, seek deferral or enter in to a payment plan with OSR.
APPRENTICES SUBSIDY
Employers who employ registered apprentices will be entitled to a subsidy for wages paid to them for the period 1 January to 30 September. The subsidy is equal to 50% of each apprentices gross wages, up to a maximum of $7000 per quarter. To receive the maximum subsidy, the apprentice would need to be on a gross annual wage of $56,000 or more.
You can access the subsidy at the end of each quarter. You must apply for this subsidy as it is not provided automatically like most other stimulus measures.
We understand that the application forms that you need to complete will be available shortly.
PROTECTION FOR COMPANY DIRECTORS FROM INSOLVENCY CLAIMS AND DIRECTOR PENALTY NOTICES
The government has announced that all Directors will be given protection from being sued for trading insolvent and protection from being issued Director Penalty Notices for not paying PAYGWT and GST.
The rules around this are very complex and very specific to each client. So if you have any concerns or questions about how this protection might work for you then we urge you to contact your Alan Hall advisor to discuss this further.
As a general rule to provide you with the best protection, you should always lodge every BAS or IAS (at least within 3 months of the due date) even if you are not going to be paying it immediately.
BANK LOANS
If your cashflow that you need for continuing to operate your business or for continuing to pay household costs is being impacted by bank loan repayments then the Banks are providing short term deferrals.
If you have not already contacted your Bank about obtaining a deferral of interest and or principal repayments then you should do so now. In most cases that we have seen the Banks are coming to the party with deferrals of up to 6 months. What deferral you can get will be up to the Bank and will be determined on your individual circumstances.
We understand that the Banks have now been provided by the Federal government with full detail of the up to $250,000 unsecured loans where the government is securing 50% of the debt.
On Friday most of the major banks had internal training sessions via video link for their loan officers to explain the process and eligibility. So we believe that this week the banks will be in a position to start the process of rolling these out.
Again if you are in need of such a loan to support your cashflow then we urge you to contact your bank to register your interest for applying for these loans.
Any commercial inquiries are advised to contact their business banker directly to discuss options available to them.
We have put together this handy contact guide:
ANZ – 1800 2525 845 or fill out the form at: https://www.anz.com.au/about-us/sustainability/financial-hardship/hardship-enquiry/
CBA – 13 22 24 or fill out the form via your NetBank: https://www.commbank.com.au/digital-banking/netbank.html
ING – 1300 349 166 or fill out the form at: https://www.ing.com.au/help-and-support/tips-hints-guides/financial-hardship.html
MACQUARIE – Fill out the form at: https://www.macquarie.com/au/personal/forms/payment-pause
ME BANK – 13 15 63 or fill out the form at: https://www.mebank.com.au/support/financial-hardship/apply-for-support/
NAB – 1300 683 106 or fill out the form at: https://www.nab.com.au/personal/help-and-guidance/financial-hardship?own_cid=shohttps://www.nab.com.au/personal/customer-support/covid19-help/home-owners-supportrtURL:hardship
QUDOS – Email: [email protected]
RESIMAC – Email: [email protected]
ST GEORGE – 13 33 30 or fill out the form at: https://www.stgeorge.com.au/contact-us/financial-hardship/apply-for-assistance
SUNCORP – 13 11 55 or fill out the form at: https://www.suncorp.com.au/banking/help-support/coronavirus-contact-form.html
WESTPAC – 132 032 or fill out the form online at: https://www.westpac.com.au/about-westpac/sustainability/initiatives-for-you/customers-financial-hardship/apply-for-assistance/
Please note that all lenders will be receiving significant calls at the moment so we suggest the best way to contact them is via the online forms.
If you want to discuss whether you should look to apply for an unsecured loan under this stimulus package then please contact your Allan Hall advisor.
We will let you know as soon as we have more details on the Government assistance measures and we invite you to discuss your options and any questions with your Allan Hall advisor.