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Australia's Second Stimulus Package

Australia's Second Stimulus Package

Released: 22/03/2020

The initial stimulus package has been enhanced with a second stage of the Commonwealth Government’s economic plan, designed to lessen the impact and build a bridge for recovery. We’ve digested this for you here.

Business cashflow payments have been increased and support for households is widening to assist those who have lost their jobs or had their hours reduced, casual workers, sole traders, retirees, etc.

We are business as usual here at Benefit Accounting and are following the lead of our Prime Minister, Scott Morrison. We’re here to help our clients digest everything, keep their businesses running and receive the money they’re entitled to under the stimulus package. We feel a professional responsibility to each of you in these changing times. We are available for you via phone, Skype and email or by appointment in appropriate circumstances to answer any questions you have.

We’re talking to all our clients and we’d love to talk to you about how you can receive financial aid and what you can do to protect, manage and safe-guard your business, cashflow and assets. Please click here to reach out to us at Benefit Accounting now.

Read on for our second stimulus highlights for:

BUSINESS

  • The cashflow boost set to be received, by small to medium-sized businesses that employ staff, has been increased. The minimum payment is set to be increased from $2,000 to $10,000 and the 50% calculation of withholding is being increased to 100% with a maximum up from $25,000 to $50,000 refund payment. Fact sheet here for more info or go direct to the source at the ATO.

    • More! There’s talk of this being doubled in the July - October 2020 period where eligible employers will receive an additional payment equal to what they received from the above, i.e. the $10,000 minimum could become $20,000 and the calculated $50,000 maximum could become $100,000.

  • The Queensland Government announced low interest loans of up to $250,000 (interest free for the first 12 months) and two rounds of the COVID-19 Adaptation $10,000 Grant for businesses to retain staff and maintain operations. These funding schemes were all fully committed within weeks, if not days, upon there opening and are now all closed.

  • Guarantees are being given to lenders to enhance their willingness to provide short-term unsecured loans to struggling businesses. We urge you to seek advice first before obtaining finance.

  • Protection measures are temporarily being put in place to shield otherwise profitable businesses who are feeling the temporary financial distress to help safe guard against insolvency, wind-ups, statutory demands (threshold now up to $20k) and personal director liability, etc. Fact sheet here for more info.

  • The JobKeeper Payment to use for your employees or to help the self-employed, click here for more info. Released on 30/03/2020 until 27/09/2020, now extended until 28/03/2021.

  • A reminder of the initial stimulus release that is still in force:

    • The business incentive increase to the instant asset writeoff threshold increase from $30,000 to $150,000 for small to medium-sized businesses temporarily until June 2020 (extended to 31/12/2020). Plus depreciation rules will also be accelerated until June 2021 where 50% of the initial asset cost can be depreciated in the year of purchase. All this in an effort to keep the economy stimulated by encouraging businesses to carry on with their plans to purchase large items, such as cars, machinery, equipment, etc. Fact sheet here for more info.

    • Businesses who employ trainees or apprentices will receive wage subsidies of 50% of the apprentice or trainee’s wage for up to 9mths between January - September 2020. Fact sheet here for more info (page5).

INDIVIDUALS

  • Providing an extra $550/fortnight ‘Coronavirus supplement’ from 27 April 2020 for the next six months to eligible income support recipients on top of their usual fortnightly payment. Fact sheet here for more info or visit this website.

  • Expanded access to the JobSeeker Payment (previously known as Newstart) to self-employed, casual workers and employees, even if still working based on the income tests. Asset tests and waiting periods will be waived as well to allow easier access to this. The earnings threshold for a partner of someone claiming JobSeeker will be increased from $48,100 to $79,762. Click here for more info or straight to how to claim here. If you need help, try this or feel free to ask us!

  • The release of a second $750 once-off payment from 13th July 2020 is scheduled to be automatically paid to eligible welfare recipients not receiving the extra $550/fortnight Coronavirus supplement’ (such as those on the disability or aged pension). Fact sheet here for more info.

    • The initial $750 payment will still be paid from 31st March to people who have been on one of the eligible social security and veteran payments between 12/03/2020 - 13/04/2020.

  • Allowing people in financial stress to access $10,000 from their superannuation on 20/04/2020 until 30/06/2020 and a further $10,000 within three months after that but before 24/09/2020. We urge you to seek advice before doing this as withdrawing from your super is effectively selling out at the worst possible economical time but we understand you may not have a choice. To be eligible, you must be unemployed/made redundant or suffered a reduction of 20% in working hours (or turnover for businesses) or be eligible for another benefit (JobSeeker, Youth Allowance, Parenting Payment, etc). Fact sheet here for more info.

  • To benefit retirees, superannuation minimum drawdown requirements are being temporarily reduced for account based pensions and similar products by 50% for FY2020 and FY2021, providing more flexibility on how superannuation assets can be managed. Fact sheet here for more info.

  • The JobKeeper Payment your employer may utilise to help keep you connected to your job, click here for more info. Released on 30/03/2020.

The stimulus package will continue to evolve with the impact of the coronavirus. Follow our socials and we’ll keep you updated.

More Info and Support

Please click here to reach out to us at Benefit Accounting now.