Covid_19 Update

|by Jarrad Young|Business Advisory,Taxation and Compliance

With the crisis escalating at an exponential rate, we do note and appreciate the elevated levels of concern in our community. In our business, we recently had the office working from home for a 3 day period and found our systems were robust, so feel we are prepared for a more formal lock down period should that directive be issued by the Government. Even so, some of our team are making the decision, with our support, to work from home for various reasons associated with the crisis, whether that’s to care for their children or to better protect their vulnerable family members. We expect our clients to still be able to access all advisors they usually deal with, though our preference is changing to online meetings or tele-conferences to restrict travel and potential exposure.

We hope everyone is keeping well and observing appropriate measures to reduce exposure to, and spread of, Covid19. While we review those measures, Governments continue to roil out business support packages which we will continue to update in the forum.

Queensland Payroll Tax Relief

Media reports indicate that the Queensland Government will enhance the payroll tax relief measures to now offer a waiver of payroll tax for 3 months for small and medium businesses (“SME’s”). Previously, the measure was to merely defer payment of the payroll tax liability until August 2020.

It is expected that this measure will also involve a refund of payroll tax paid for January and February 2020. Furthermore, eligible businesses can also apply for a deferral of payroll tax liabilities for the 2020 calendar year (following expected waiver of payroll tax for 3 months).

With the formal announcement made today, we will be monitoring for further detail on eligibility and timing.

Summary of Known Stimulus / Bail Out Packages

The Federal Government has announced several measures to assist business and each State Government has also implemented varying programs to try and maintain employment, mainly through payroll tax concessions and waivers. A summary of those measures announced for Victoria, New South Wales, Queensland and Federally is set out below.

Federal

  • PAYG credits of up to $50,000 for SME’s for the period to June 2020 and a further $50,000 for the period to September 2020
  • 50% subsidy for apprentice or trainee wages
  • Government ‘backed’ loans (50% of bank loan amount guaranteed by the Government)
  • Instant asset write off up to $150,000 to be used by 30 June 2020

Queensland

  • Waiver of payroll tax for SME’s (recent announcement, detail still to be advised)
  • Interest free loans to business of up to $250,000. Expressions of interest can be submitted online here
  • Diversification grants of up to $50,000 for SME’s in the agriculture, food and fish exporting industries
  • Waiving various fees for SME’s (mainly associated with hospitality and tourism operators)

New South Wales

  • Payroll tax reduction of 25% of annual liability for SME’s. No payroll tax monthly lodgements required for March, April and May.

Victoria

  • No payroll tax for SME’s with wages less than $3 million. We are awaiting detail as to whether the wages threshold is Victorian wages or national wages.
  • Deferral of land tax payments for eligible businesses
  • Establishment of a business support fund for businesses in hospitality, tourism, accommodation, arts, entertainment and retail sectors.

Next Steps

We are constantly monitoring the various Government announcements and make sure our clients are positioned to best utilise them. If you have any questions at all concerning any particular measure and how it may apply to your business, please do not hesitate to contact us.

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