Federal Government Coronavirus Information is available here: https://www.australia.gov.au
South Australian Coronavirus Information is available here: https://www.sa.gov.au/covid-19
The following is a compilation of key Government assistance for small and medium-sized businesses – announced as at 30 March 2020. Please refer to the More information links below to download the Government Factsheet and/or to be taken to the department website.
The Government has announced a wage subsidy of $1,500 per worker per fortnight for up to six months, starting from 1 March 2020. The subsidy requires employers to apply through the Tax Office through the Tax Office website and provide the number of eligible employees each month. The Tax Office will then pay the subsidy in arrears.
ACCELERATED ASSET DEPRECIATION
Businesses can accelerate depreciation for new assets which are used or ready for use between 12/3/20 and 30/6/21.
Small businesses (turnover less than $10 million): Depreciation rate increases from 15% to 57.5%
Small and medium businesses (turnover less than $500 million): Depreciation rate of 50% plus the usual depreciation rate for the remaining asset value. Applies to assets worth more than $150,000 in 2019/20 and assets worth more than $1,000 in 2020/21.
CASH FLOW SUPPORT
The Government will provide two ‘cash boosts’ for small and medium-sized businesses and non- profit organisations that employ staff. These will be credits associated with business activity statements and will be automatic — so you don’t need to complete any additional forms. Note there are some eligibility requirements, but most businesses with turnover below $50 million will qualify.
The amount of the boost is based on PAYG withholding, with a minimum credit of $10,000. The first boost will be paid from 28 April 2020.
INSTANT ASSET WRITE-OFF
The Government has made changes to the Instant Asset Write Off program. For assets used or ready for use between 12/3/20 and 30/6/20, the threshold for eligible assets has been increased from $30,000 to $150,000 and the maximum turnover for eligible businesses has been increased from $50 million to $500 million.
CHANGES TO BANKRUPTCY AND INSOLVENCY RULES
The Government has introduced some temporary changes, including:
- Increase in the threshold for statutory demands (from $2,000 to $20,000)
- Increase in the time companies have to respond (from 21 days to six months)
- Increase in the time where a debtor has protection from further action by unsecured
creditors (from 21 days to six months)
Directors have also been temporarily relieved of their duty to prevent insolvent trading with regards to debts incurred in ordinary business.
SUPPORT FOR APPRENTICES AND TRAINEES
Small businesses are able to apply for a 50% wage subsidy for apprentices and trainees. The subsidy applies for nine months between 1 January and 30 September 2020 and will be paid as a reimbursement of up to $21,000. Applications can be made through the relevant Australian Apprenticeship Support Network provider.
BUSINESS LENDING SUPPORT
The Government has also announced that it will be providing a 50% guarantee to lenders for new, short-term loans. Eligible businesses have turnover up to $50 million and include sole traders. Loans can be up to $250,000 and three years, and borrowers are able to suspend repayments for the first six months. These loans will be made through normal lenders (including banks and other financial institutions). The Government is also relieving banks of certain obligations in lending to small businesses.