COVID-19 - what you need to know as a business owner

DISCLAIMER: The below is based on current information available and may change when the legislation is written and passed by parliament. 

There are many areas that our amazing team at Aegis Business Services can support you on – so without overwhelming you during these unprecedented times we thought we would start by alerting you to the assistance the Government announced on Thursday, 12 March 2020. 

BAS/IAS Relief 

Reduction in PAYGW paid to ATO for the periods 1 January 2020 to 30 June 2020 by way of a credit against the reported BAS/IAS – if it results in a refund this will be paid within 14 days. 

Points to Note: 

• Turnover must be less than $50 million 
• Must employ staff & withhold PAYG from employee wages 
• Minimum available to all businesses which pay wages is $2,000 even if not required to withhold tax 
• Maximum available is $25,000 over the six-month period   
• Expected to benefit 690,000 business employing around 7.8 million people 

https://business.gov.au/risk-management/emergency-management/coronavirus-information-and-support-for-business/boosting-cash-flow-for-employers 

PAYG Income Tax Instalments Revision 

If turnover for the 1 January 2020 to 30 June 2020 period is expected to reduce in your business we suggest we consider revising the Income Tax in the Q3 BAS (1 January 2020 to 31 March 2020) reporting with the likelihood that if Q1 & Q2 payments exceed the new Income Tax calculation a refund will be paid. 

https://www.ato.gov.au/Individuals/Dealing-with-disasters/In-detail/Specific-disasters/COVID-19/?page=1#Pay_as_you_go_instalments 

Apprentice & Trainees Support 

As an employer of an apprentice or trainee you may be eligible for a 50% wage subsidy of the apprentice or trainees’ wages paid during the 9 month period of 1 January 2020 to 30 September 2020.   

Points to Note: 

• Must have fewer than 20 full-time employees who retain an apprentice or trainee 
• Apprentice or trainee must be in training as at 1 March 2020 
• Employers will be reimbursed up to a maximum of $21,000 per eligible apprentice or trainee  ($7,000 per quarter) 
• Expected to benefit 70,000 small business employing around 117,000 apprentices or trainees. 

https://business.gov.au/risk-management/emergency-management/coronavirus-information-and-support-for-business/supporting-apprentices-and-trainees 

Increasing Instant Assets Tax Write-off 

For businesses with turnover below $500 million the threshold for instant asset write-off has increased from $30,000 to $150,000.  This is available through to 30 June 2020.   

Before purchasing a fixed asset please feel free to contact us to discuss your situation. 

https://business.gov.au/risk-management/emergency-management/coronavirus-information-and-support-for-business/instant-asset-write-off 

Accelerated Depreciation Deductions 

For businesses with turnover below $500 million you will be able to immediately deduct 50 per cent of the asset cost in the year of purchase with the balance of the asset cost being depreciated at the existing rates.  This is available through to 30 June 2021.   

Before purchasing a fixed asset please feel free to contact us to discuss your situation. 

https://business.gov.au/risk-management/emergency-management/coronavirus-information-and-support-for-business/backing-business-investment-bbi 

Ability to change GST Reporting Period 

If you are on a quarterly reporting cycle, you may elect to change your GST reporting and payment to monthly, this will give you quicker access to any GST refunds you are entitled to.  Please note that changing your GST reporting cycle to monthly doesn’t mean you have to change your PAYG Withholding reporting cycle. 

Please contact us to discuss your needs as it does mean that you need to continue to report on a monthly basis for a minimum of 12 months. 

https://www.ato.gov.au/Individuals/Dealing-with-disasters/In-detail/Specific-disasters/COVID-19/?page=1#Monthly_GST_credits 

Tax Payment Deferrals, Remittance of Penalties & Interest and Lower Interest Rate 

The ATO are generously offering to consider individual cases regarding possible tax payment deferrals, possible remittance of interest and penalties or possible lower interest rates if on payment plans. 

As these are all independent & are considered case by case, please contact us to discuss this matter further. 

https://www.ato.gov.au/Individuals/Dealing-with-disasters/In-detail/Specific-disasters/COVID-19/?page=1#Payment_deferrals 

https://www.ato.gov.au/Individuals/Dealing-with-disasters/In-detail/Specific-disasters/COVID-19/?page=1#Remitting_interest_and_penalties 

FAIRWORK – Employment Update 

On Friday Fairwork released their latest update on dealing with Coronavirus in the workplace.   

We encourage employees and employers to work together to find appropriate solutions that suit the needs of individual workplaces and staff. This may include taking different forms of leave, working from home, or taking extra precautions in the workplace. 

For all the latest details refer to this link as it is updated regularly 
https://www.fairwork.gov.au/about-us/news-and-media-releases/website-news/coronavirus-and-australian-workplace-laws 

As soon as more updates are released we will try gather the facts and advise accordingly in these uncertain times to keep you as business owners informed.

Kind Regards

The Team at Aegis Business Services