Updated: Mar 23
The Federal Government has announced a $17.6 billion stimulus package to help prevent a coronavirus related recession.
What are the key measures?
The instant asset tax write-off threshold will be raised from $30,000 to $150,000. This applies from now until 30 June 2020 and has been expanded to include businesses with an annual turnover of up to $500 million (up from the current $50 million).
A 50% accelerated depreciation deduction for new depreciating asset purchases until 30 June 2021, available for businesses with less than $500 million turnover.
A tax-free payment of up to $25,000 for businesses with a turnover under $50 million. For those businesses that pay income tax on employee’s salary and wages (either quarterly or monthly) they will receive a payment via their BAS or IAS, from 28 April 2020, equal to 50% of the amount withheld, up to a maximum of $25,000. The refunds will be paid within 14 days. Businesses that pay salary and wages but are not required to withhold tax will receive a minimum of $2,000.
Wage subsidies to support the retention of apprentices and trainees. Employees with less than 20 full-time employees may be entitled to apply for Government funded wage subsidies amounting to 50% of an apprentice’s or trainee’s wage for up to nine months from 1 January 2020 to 30 September 2020. The maximum subsidy for each apprentice /trainee is $21,000. Importantly, where an employer is not able to retain an apprentice, the subsidy will be available to a new employer that employs that apprentice. Employers to be will be able to register for the subsidy from early-April 2020.
An instant cash payment of $750 for pensioners, holders of the Commonwealth seniors card and recipients of Newstart, carer’s allowance, youth allowance, veterans support, disability support and family tax benefits. These payments will be rolled out from 31 March 2020.
Assistance to severely affected regions. The government has set aside $1 billion to support regions and communities that have been disproportionately affected by the economic impacts of the Coronavirus including those heavily reliant on industries such as tourism, agriculture and education.
Administrative relief. The Australian Tax Office (ATO) will provide administrative relief for certain tax obligations (similar to relief provided following the bushfires) for taxpayers affected by the Coronavirus outbreak, on a case by case basis.
The relevant legislation will be introduced into parliament in the final sitting week in March 2020.
If you have any questions at all, please do not hesitate to contact your Client Manager.
Image Credit: https://www.abc.net.au/news