Economic Stimulus for Phoenix

1 .Support for Cash flow needs

Government will provide a guarantee of 50 per cent to SME lenders for new unsecured loans to
be used for working capital.
Eligibility
o SMEs with turnover of less than $50m
o Commences early April till 30 September 2020
o Maximum total size of loans of $250,000 per borrower
o The loans will be up to three years, with an initial six-month repayment holiday.
o The loans will be in the form of unsecured finance, meaning that borrowers will not have
to provide an asset as security for the loan.
o It will be in the form of facility and no interest to accrue if not drawn

2. Boosting cash flow for employers – PAYGW relief

Who is eligible?

• Small or medium business entity
• Held an ABN on 12 March 2020 and continues to be active
•  Has an aggregated annual turnover under $50 million

Criteria

– Businesses made eligible payments – like salary, wages, director fees and withhold tax on their
employees’ salary and wages
– Must have either
o lodged your income tax return for 2018/19 before 12 March 2020 or
o lodged previous BAS by the relevant dates
– You must lodge your activity statement to receive the cash flow boost

When will it be received?

– Quarterly BAS
o quarter 3, March 2020 (lodgement due date 28 April 2020)
o quarter 4, June 2020 (lodgement due date 28 July 2020)
– Monthly BAS by the relevant monthly deadlines
o March 2020 (lodgement due date 21 April 2020)
o April 2020 (lodgement due date 21 May 2020)
o May 2020 (lodgement due date 21 June 2020)
o June 2020 (lodgement due date 21 July 2020).

Calculation

– Based on the amount of your PAYG withholding
– Businesses will receive tax free credit equal to 100% of the amount tax withheld from employees
– Payments in 3 stages
o minimum of $10,000 up to a maximum of $50,000 as Stage 1 payment and
o an equivalent amount split as Stage 2 and Stage 3 payments for a maximum of $100,000
– So, a minimum total payment of $20,000 to a maximum of $100,000
– Will be based on March 20 quarterly basis
– Or 3 times of the March 20 for monthly lodgers

If PAYGW is below $10k for March 20 quarter, you will receive a minimum of
o $10k for March 2020 BAS
o $5k for June 2020 BAS
o $5k for Sept 2020 BAS

3. JobKeeper Payments – up to $1,500 per fortnight to retain workers

Who is eligible?

Employers

– Business with turnover of less than $1b – revenue has fallen more than 30% from 1 March 2020
over a minimum 1 month
– Business with turnover of more than $1b – revenue has fallen more than 50% from 1 March 2020
over a minimum 1 month
– Register your interest https://www.ato.gov.au/general/gen/JobKeeper-payment/

Employees

– Full time and part time employees, including stood down employees, over 16 years currently
employed
– Where a casual employee has been with their employer for at least the previous 12 months
– An employee will only be eligible to receive this payment from one employer.

Criteria

– Every eligible employee must receive at least $1,500 per fortnight from their employer, before
tax.
– Payments will be received for 6 months
– Eligible employers will need to identify eligible employees for JobKeeper Payments and must
provide monthly updates to the ATO
– Employers need to inform eligible employees of JobKeeper Payments

When will it be received?

– Eligible businesses can start distributing First week of May by employers
– Employers can start paying JobKeeper payment immediately and will be reimbursed from first
week of May and will be backdated to 30 March 2020

Calculation

– Eligible employers will need to pay eligible employees a minimum of $1,500 before tax per
fortnight

Businesses without employees

– Businesses without employees, such as the self-employed, can register their interest in applying
for JobKeeper Payment via www.ato.gov.au from 30 March 2020.
– will need to provide an ABN for their business, nominate an individual to receive the payment
and provide that individual’s Tax File Number and provide a declaration as to recent business
activity
– People who are self-employed will need to provide a monthly update to the ATO to declare their
continued eligibility for the payments. Payment will be made monthly to the individual’s bank
account.

4. Increasing the instant asset write-off

– Applies to businesses with aggregated turnover of less than $500 million per annum
– Applies to all assets purchased between 12th March 2020 to 30th June 2020
– Increasing the instant asset write-off from $30,000 to $150,000 for new and second-hand assets
– And asset should be installed and ready to use by 30 June 2020
– This write off applies to individual assets under the threshold and there is no limit to purchasing
the assets.
– This benefit will be realised when your FY2020 tax return is lodged.

5. Apprentices and Trainees Support

– Applies to businesses who employ apprentices and trainees and employ fewer than 20 full time
employees.
– Assistance will be 50% of the apprentice or trainee’s wages paid up to a maximum of $21,000.
– Employers will need to register for subsidy from early April 2020 with final claims due 31st
December 2020.
– An eligibility assessment will be conducted by an Australian Apprenticeship Support Network
Provider.
– Assistance will be paid to employers after a claim process is undergone and the claim is deemed
successful.

6. ATO Administrative Relief

– Applies to businesses affected directly by the Coronavirus (COVID 19) outbreak (on case by
case basis) – details are limited at this stage.
– Assistance could be tax obligations will be placed on hold and extensions granted.

7. Income support for individuals

– Coronavirus supplement of $550 per fortnight for the next 6 months
– This will be paid to both existing and new recipients of JobSeeker Payment, Youth Allowance
Jobseeker, Parenting Payment, Farm Household Allowance and Special Benefit.
– Will commence on 27 April 2020