To protect and support businesses to weather disruption caused by Coronavirus outbreak, PM has announced the details of a $17.6b stimulus package on the 12th March 2020. Many of SBE clients have already reached out to me finding out what these measures mean. We have selected some of the measures for your interest:-
1. Instant Asset write-off. From 12th March 2020 until 30th June 2020, businesses (less than $500 million turnovers) can immediately write-off multiple assets acquired less than $150,000 (from $30,000).
2. Helping employers' cashflow. SME businesses with less than $50 million aggregated turnover and employe workers. Between 1st January 2020 and 30th June 2020, you will receive a payment equal to 50% of the PAYG withheld from Wages(paid to your company's employees), delivered as a credit in your March 20 BAS and June 20 BAS, with a minimum $2,000 payment and up to a cap of $25,000. For example, if your March 2020 BAS says $10,000 payable as PAYG withheld, ATO will reduce $10,000 down to $5,000 payable.
3. Relief from the Australian Tax Office (non-tax measure)
- You can defer up to 4 months of tax payment due through BAS ( PAYG, PAYG income tax, FBT assessment)
- You can opt into Monthly GST reporting from Quarterly Basis, with a sole purpose to receive quicker GST refunds
- Any Interest and Penalties (incurred by affected businesses after 23rd Jan 2020) can be Remitted
- You can vary PAYG income tax instalment to Nil for March 20 and June 20 Quarter
For legislation to give effect to these measures will be introduced into Parliament (resume from 23rd March 2020), which may pass it urgently. You should consider taking extra cautious when choosing to vary PAYG instalment to zero, as it may not be as beneficial as it sounds. Also, the credit delivered from ATO to compensate the PAYG Withholding from wages are Tax-Free.