I wanted to make your life easy in understanding what stimulus measures you might be entitled to, and are relevant for businesses in particular, due to these uncertain times.
The areas to focus on the stimulus package for your business are as follows:
- PAYG Withholding Credits – This is the reference of up to $ 100,000 from the government. You have to actually be remitting this kind of money to the ATO in the first place for Wages tax. It reduces according to your level of payroll. I highly recommend we handle and lodge your next 4 x BAS’s (if we aren’t doing this already) to get the maximum we can for you as the measures extend over 4 BAS periods.
- Personal PAYG Credits – This is the PAYG you might be paying personally. The ATO is allowing a credit back for any payments made in Sept 19 and Dec 19 and variation of March 2020 to NIL to help with cashflow. Please note, this is merely a deferral and not a windfall.
- Company PAYG Credits (if you have a company) – This is Income tax your company might be paying quarterly in its BAS . The ATO is allowing a credit back for any payments made in Sept 19 and Dec 19 and variation of March 2020 to NIL to help with cashflow. Please note, this is merely a deferral and not a windfall.
- Deferral of BAS, Income Tax and FBT Payments of up to 4 months – Seek out the ATO to get the maximum deferral or contact us to arrange this for you. We have been successful in getting more than 4 months on some occasions.
- Unsecured Business Loans from Banks (supported by the Government) – It is early days on how this will work. I do note however, the banks are likely to put you under the normal lending assessment process. But I recommend you contact your bank towards the end of this week as not even the banks will know right now how this will work.
- Seeking 6 month deferral on loan repayments – Again, contact your bank in a few days on business and personal/investment loans.
- Payroll Tax Relief – State Governments around the country are offering various concessions including credits and payment deferrals. Please contact us to discuss what is relevant to you.
- Sole Traders (Doing Business Under their own name) – The government, via centrelink, are giving a reprieve if your income drops by 20%. You need to contact centrelink and run through their criteria. We don’t know yet how this is going to work, so please be patient with the process. $550 per fortnight payment to Sole Traders whose income has dropped.
- Apprentice and Trainee Subsidy – Employers of Apprentices or Trainees with less than 20 Employees may receive a Subsidy of 50% of wages for 9 months to max of $21k per apprentice. You will need to speak to your apprenticeship provider on whether you are eligible and for how much.
There are also some very attractive income tax savings on buying assets/equipment before the financial year is out. If you are interested in these and need any help with the above, then please don’t hesitate to call me or my team.
By: Mark De Luca | Director Of Tax And Accounting
T: (08) 6165 4000