Latest Update - 23 March 2020
Dear Friends,
We know that these are unprecedented times and we are all facing many challenges. Things are changing hourly if not faster and Adams Triglone are continuing to work around the clock to keep you up to date with all of these developments. We have put into place arrangements to allow our team members to continue to work to ensure we are here for you when you need us. We are not going anywhere. For the safety of our team, we may be working from home at times but remain available through all the usual channels - emails and phone numbers remain the same.
We will be updating our Facebook, Linked in and blog regularly as updates come through rather than continually clogging up your inbox. We encourage you to go to these links and like or follow for updates:
Facebook
Linked in
We understand everyone's circumstances are different and we will be in touch with each of you in due course to determine how this affects you. In the meantime, if you are concerned please call us today or whenever you need to on 02 8848 3000 or you can also email our office at enquiries@adamstriglone.com.au
Below is further information about the Government Stimulus package announced yesterday.
Some points to consider:
1) Government Stimulus Programs have been released in various jurisdictions to benefit small business owners, veterans, the unemployed and other groups. The provisions of these programs (and associated processes) are evolving as the situation develops. You may be a beneficiary under these programs.
2) Running Your Business: Your industry, market, regulatory environment and other factors will influence what you need to do. Change in demand for your products, unpredictable supply chains, altered working conditions and reduced access to debt may impact you. We are seeing businesses that are dramatically affected and those which are unaffected. Some businesses are finding opportunities and will be strengthened through these events. Identify the risks and opportunities you are facing and take appropriate steps.
3) Personal Affairs: Be aware that these events will affect businesses and also the individuals within them. Some will be subject to travel restrictions, stock market volatility or concerns for the well-being or vulnerable friends and family. Employers should be sensitive to this in the course of business decision-making.
4) An Opportunity to Reflect: Dramatic events prompt us to look critically at our situation and take care of our affairs which we may have neglected. Wills, succession planning and asset protection are a good starting point. Who do you depend upon and who depends upon you? What needs to happen to strengthen these relationships? We can help you navigate this.
5) Thinking Long-Term: While many people will think tactically and short term, this may be an opportunity to set longer-term goals ... and get ahead of the competition.
6) Access to Information: There are many sources of information but, unfortunately, some are not credible. Try to eliminate the 'noise'. It is unlikely that the decisions you need to make require minute by minute updates on 'breaking news'. Important news will find you... so use the 'in-between time' to strengthen your business and personal affairs.
There are going to be some tough times ahead but working through it together one step at a time we will come out the other side stronger.
Please be patient and kind to each other in these uncertain times.
Look after yourselves and your family.
Greg
Latest information
The Government is now providing up to $100,000 to eligible small and medium sized businesses, and not-for-profits (including charities) that employ people, with a minimum payment of $20,000.
On 12 March 2020, the Government announced the Boosting Cash Flow for Employers measure. The measure initially provided up to $25,000 to business, with a minimum payment of $2,000 for eligible businesses. Small and medium sized business entities with aggregated annual turnover under $50 million and that employ workers are eligible.
The Government has enhanced this measure as part of the second economic response package. Not-for-profit entities (NFPs), including charities, with aggregated annual turnover under $50 million and that employ workers will now also be eligible. This will support employment activities at a time where NFPs are facing increasing demand for services.
An additional payment is also being introduced in the July – October 2020 period. Eligible entities will receive an additional payment equal to the total of all of the Boosting Cash Flow for Employers payments they have received.
This means that eligible entities will receive at least $20,000 up to a total of $100,000 under both payments. This additional payment continues cash flow support over a longer period, increasing confidence, helping employers to retain staff and helping entities to keep operating.
The cash flow boost provides a tax free payment to employers and is automatically calculated by the Australian Taxation Office (ATO). There are no new forms required.
Eligibility
Boosting Cash Flow for Employers payments
Small and medium business entities with aggregated annual turnover under $50 million and that employ workers will be eligible. Eligibility will generally be based on prior year turnover.
· The payment will be delivered by the Australian Taxation Office (ATO) as a credit in the activity statement system from 28 April 2020 upon businesses lodging eligible upcoming activity statements.
· Eligible businesses that withhold tax to the ATO on their employees' salary and wages will receive a payment equal to 100 per cent of the amount withheld, up to a maximum payment of $50,000.
· Eligible businesses that pay salary and wages will receive a minimum payment of $10,000, even if they are not required to withhold tax.
· The payments will only be available to active eligible employers established prior to 12 March 2020. However, charities which are registered with the Australian Charities and Not for profits Commission will be eligible regardless of when they were registered, subject to meeting other eligibility requirements. This recognises that new charities may be established in response to the coronavirus pandemic.
Additional payment
To qualify for the additional payment, your business must continue to be active.
For monthly activity statement lodgers, your additional payments will be delivered as an automatic credit in the activity statement system. This will be equal to a quarter of your total initial Boosting Cash Flow for Employers payment following the lodgment of your June 2020, July 2020, August 2020 and September 2020 activity statements (up to a total of $50,000).
For quarterly activity statement lodgers, the additional payments will be delivered as an automatic credit in the activity statement system. This will be equal to half of your total initial Boosting Cash Flow for Employers payment following the lodgment of your June 2020 and September 2020 activity statements (up to a total of $50,000).
This measure will benefit around 690,000 businesses employing around 7.8 million people, and around 30,000 NFPs (including charities).
Timing
Boosting Cash Flow for Employers payments
The Boosting Cash Flow for Employers measure will be applied for a limited number of activity statement lodgments. The ATO will deliver the payment as a credit to your business upon lodgment of your activity statements. Where this places the business in a refund position, the ATO will deliver the refund within 14 days.
| Type of lodger |
Eligible period |
Lodgment due date |
| Quarterly |
Quarter 3 (January, February and March 2020) |
28 April 2020 |
| Monthly |
March 2020 |
21 April 2020 |
Quarterly lodgers will be eligible to receive the payment for the quarters ending March 2020 and June 2020.
Monthly lodgers will be eligible to receive the payment for the March 2020, April 2020, May 2020 and June 2020 lodgments. To provide a similar treatment to quarterly lodgers, the payment for monthly lodgers will be calculated at three times the rate (300 per cent) in the March 2020 activity statement.
The minimum payment will be applied to the business' first lodgment.
Additional payment
The additional payment will be applied to a limited number of activity statement lodgments. The ATO will deliver the payment as a credit to your business upon lodgment of your activity statements. Where this places the business in a refund position, the ATO will deliver the refund within 14 days.
| Type of lodger |
Eligible period |
Lodgment due date |
| Quarterly |
Quarter 4 (April, May and June 2020) |
28 July 2020 |
| Monthly |
June 2020 |
21 July2020 |
Quarterly lodgers will be eligible to receive the additional payment for the quarters ending June 2020 and September 2020. Each additional payment will be equal to half of your total initial Boosting Cash Flow for Employers payment (up to a total of $50,000).
Monthly lodgers will be eligible to receive the additional payment for the June 2020, July 2020, August 2020 and September 2020 lodgments. Each additional payment will be equal to a quarter of your total initial Boosting Cash Flow for Employers payment (up to a total of $50,000).
Early release of superannuation
The Government will allow individuals in financial stress as a result of the Coronavirus to access up to $10,000 of their superannuation in 2019-20 and a further $10,000 in 2020-21.
Eligible individuals will be able to apply online through myGov for access of up to $10,000 of their superannuation before 1 July 2020. They will also be able to access up to a further $10,000 from 1 July 2020 for another three months. They will not need to pay tax on amounts released and the money they withdraw will not affect Centrelink or Veterans' Affairs payments.
This measure is estimated to cost $1.2 billion over the forward estimates period.
Temporary reduction in Minimum Drawdown Requirements
The Government has announced that the minimum pension requirements for 2019/20 and 2020/21 will be re-set to half the normal rates and there will be changes to the deeming rates used to calculate an individual's income for a range of important government benefits (including the age pension).
Similar to the approach taken in the 2008/09 Global Financial Crisis, the minimum drawdown requirements for account based pensions and similar products will be temporarily reduced by 50% for the 2019/20 and 2020/21 years.
The revised rates for the 2019/20 and 2020/21 years will be as follows:
| Age of Member |
Percentage Factor |
| Under 65 |
2 |
| 65 – 74 |
2.5 |
| 75 – 79 |
3 |
| 80 – 84 |
3.5 |
| 85 – 89 |
4.5 |
| 90 – 94 |
5.5 |
| 95 + |
7 |
Reducing social security deeming rates
On top of the deeming rate changes made at the time of the first package, the Government is reducing the deeming rates by a further 0.25 percentage points to reflect the latest rate reductions by the RBA.
As of 1 May 2020, the lower deeming rate will be 0.25 per cent and the upper deeming rate will be 2.25 per cent.
The change will benefit around 900,000 income support recipients, including Age Pensioners.
This measure is estimated to cost $876 million over the forward estimates period.