Stimulus Package

Government Support – What is means for you?

Link to ATO Support available during COVID-19 Crisis

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

Support for Households Fact Sheets

https://treasury.gov.au/coronavirus/households

Support for Businesses Fact Sheets

https://treasury.gov.au/coronavirus/businesses

In summary, anything available to apply for, has to be done online via MyGov

CASUALS AND SOLE TRADERS

Sole traders and casual workers who are currently making less than $1,075 a fortnight will be eligible to receive the full supplement.

If you’ve found yourself affected by the economic downturn, you’ll be able to access a “coronavirus supplement” of $550 a fortnight for the next six months.

Sole traders or casual workers who have had their income or hours reduced by 20 per cent or more as a result of coronavirus will also be able to access to up to $10,000 of their superannuation tax-free.

HOUSEHOLDS

If you’re not eligible to receive the coronavirus supplement, you could still be able to claim a $750 stimulus payment.

The payment will be made automatically from July 13 to about 5 million Australians, including those receiving the age pension, a carers allowance or family tax benefit and Commonwealth senior card holders.

EMPLOYERS WHO WANT TO KEEP STAFF

Not-for-profits and small businesses with a turnover under $50 million will receive a tax-free cash payment of up to $100,000 to help them retain staff and continue operating.

“Whether it is a coffee shop or mechanic or hairdresser… by providing at a minimum $20,000 and up to $100,000 for small businesses who employ people, [it] gives them a chance to get to the other side.”

SUMMARY OF NEW PACKAGE:

• Coronavirus Supplement: $550 per fortnight payment for recipients of the JobSeeker Payment, Youth Allowance, Parenting Payment, Farm Household Allowance and Special Benefit for the next six months

• Early access to superannuation for struggling Australians

• Temporary reduction of minimum super drawdown rates

• Extra $750 for some households, including those on social security and veteran income support and eligible concession card holders

• Reduction of deeming rates by a further 0.25 percentage points

• Small and medium businesses with turnover under $50 million, along with not-for-profit charities, will be eligible for a tax-free cash payment of up to $100,000

• Support for airlines

• Temporary relief for financially distressed businesses

• Coronavirus SME Guarantee Scheme: Government to guarantee half a bank’s loan to a small or medium enterprise impacted by the virus

SUPERANNUATION

Individuals struggling as a result of the COVID-19 outbreak will also be able to access some of their super early.

Eligible Aussies will be able to access up to $10,000 in 2019-20, and a further $10,000 in 2020-21.

To take advantage of the offer, you will need to apply online through myGov before July 1.

You won’t need to pay tax on released super, and the money withdrawn will not affect Centrelink or Veterans’ Affairs payments.

The government is also temporarily reducing superannuation minimum drawdown requirements for account based pensions and similar products by 50 per cent for 2019-20 and 2020-21.

It is designed to benefit retirees by providing them with more flexibility regarding how they manage their superannuation assets.

BUSINESSES

The government is 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.

The purpose of this payment is to boost cashflow and allow organisations to keep the lights on – and keep employees on the books.

Under the scheme, which builds upon the first stimulus package, employers will receive a payment equal to 100 per cent of their salary and wages withheld (up from 50 per cent), with the maximum payment being increased from $25,000 to $50,000.

In addition, the minimum payment is being increased from $2,000 to $10,000. The payment will be available from April 28.

By linking the payments to business to staff wage tax withholdings, the government is hoping businesses will be encouraged to hold on to more of their workers.

The payments are tax free, there will be no new forms to fill out, and payments will flow automatically through the ATO to small to medium businesses with an annual turnover of less than $50 million that employ staff.

And from July 28, eligible businesses will receive an additional payment equal to the total of all of the Boosting Cash Flow for Employers payments received.

Another measure is the Coronavirus SME Guarantee Scheme, which will see the government guarantee 50 per cent of new loans issued by eligible lenders to SMEs.

And the government is also temporarily increasing the threshold at which creditors can issue a statutory demand on a company and the time companies have to respond to statutory demands they receive.

The package also includes temporary relief for directors from any personal liability for trading while insolvent.

The Corporations Act 2001 will be amended to provide temporary and targeted relief for companies to deal with unforeseen events that arise as a result of the coronavirus.

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