Important: An update on CORDNER ADVISORY’s response to COVID-19
In light of the recent developments around the Coronavirus (or COVID-19) and the uncertainty we are all facing at this time, we felt it important to advise you to assure you that we expect no major interruptions to the services that we provide to you.
We apologise that this is quite lengthy but there is a bit of ground to cover. A summary of the main points:
- We are always contactable – our investment in cloud infrastructure means our team is online and can take calls when you need us
- Government subsidies are available for our business clients and we are ready to assist. Further government assistance and industry specific programs are expected shortly
- Business owners should carefully consider their business continuity plans
- Make sure you are personally prepared for potential isolation
OUR CLOUD SYSTEMS MEAN YOU CAN ALWAYS CONTACT US IF YOU NEED US
We have just taken the decision to temporarily close the office and have our team work from home. This was a cautious decision and we have no reason to think any of our recent visitors to the office are at risk. We do not expect this to be the situation for more than a few days but will keep you informed as we learn more.
We have been investing heavily in the latest technology in recent times, and this means we can keep assisting you through this period. Please keep emailing or phoning your Advisors when you need us, and we will be here to help you.
SME’s UNDER PRESSURE
For our business-owner clients, you need to face the possibility of team members being absent from your workplace, product supply issues and demand for your services and products reducing over the short term.
There are 2 things you need to be aware of:
- Government Stimulus Package – Our Tax Planning meeting with you this year will be VITAL!
- Business Continuity Planning
1. GOVERNMENT STIMULUS PACKAGE – OUR TAX PLANNING MEETING WITH YOU THIS YEAR WILL BE VITAL!
The Australian Government has just released a $17.6 billion economic stimulus package and you can read more about it on this blog. The package has been marketed as a measure to protect the economy by maintaining confidence, supporting investment and keeping people in their jobs.
The key tax and stimulus measures include:
- From Thursday 12 March 2020, the instant asset write-off threshold has been increased from $30,000 (for businesses with an aggregated turnover of less than $50 million) to $150,000 (for businesses with an aggregated turnover of less than $500 million) until 30 June 2020.
- A time-limited 15-month investment incentive (through to 30 June 2021) which will operate to accelerate certain depreciation deductions. This measure will also be available to businesses with a turnover of less than $500 million, which will be able to immediately deduct 50% of the cost of an eligible asset on installation, with existing depreciation rules applying to the balance of the asset’s cost. As announced, this measure is proposed to only apply to new depreciating assets first used, or installed ready for use, by 30 June 2021.
- Tax-free credits of up to $25,000 for eligible small and medium businesses (i.e., with a turnover of less than $50 million that employ staff) based on their PAYG withholding obligations. This is not a cash payment, but it is a credit equal to 50% of the PAYG amounts withheld from salary and wages paid to employees.
Businesses that lodge activity statements on a quarterly basis will be eligible to receive the credit for the quarters ending March 2020 and June 2020. Business that lodge on a monthly basis will be eligible for the credit for the March 2020, April 2020, May 2020 and June 2020 lodgements.
If a business pays salary and wages to employees but is not required to withhold any tax, then a minimum payment of $2,000 will still be made. The minimum $2,000 payment will be applied to the first activity statement lodgement.
- Wage subsidies to support the retention of apprentices and trainees – Employers 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.
- Tax-free payments of $750 to social security, veteran and other income support recipients and eligible concession card holders. It is estimated that around half of those who will benefit will be pensioners. These payments will commence to be automatically made from 31 March 2020.
When we have our 2020 Tax Planning meeting with you over the month or so, we will assist you with opportunities to restructure how you pay yourself to that you can receive the maximum cashflow assistance amounts from the Government.
We understand the Government is considering a second stimulus package which could be released in coming days. We will keep you updated with details should this eventuate.
2. BUSINESS CONTINUITY PLANNING
As a business owner, now is the time to plan for employees being away from your workplace, shortages of supply, reduction in sales, and the possibility of your workplace being closed for a short period of time if every is being forced to self-quarantine.
Over the next few weeks, we would like to meet with you or have a Zoom Meeting to discuss the following:
- Employees working from home and workplace obligations
- How do pay your bills in the short term if your sales start to dry up (cash flow preservation strategies)
- How to communicate in a reassuring way with your clients and customers
- How to keep things moving with your business
- Assistance with bank requirements should additional funding be required
- Asset protection strategies
We’re not suggesting in any way that we have all the answers, but it is important for us to work with you and help you and plan for what will happen in the weeks and months ahead.
Contact us to book in a meeting / online session so we can discuss your business situation and make plans to assist you.
GET YOUR ENDURING POWER OF ATTORNEY (“EPOA”) UPDATED / SET UP NOW
If you have to self-quarantine or are admitted to hospital, if you don’t have an EPOA then no-one else can make important business or financial decisions on your behalf.
It is 100% essential that you have an up to date EPOA and Will, and that your family know where these are stored.
These are times when we need to stay calm and rely on reliable news sources and information from State and Australian Government websites. We will be monitoring the situation as we can and will be in contact as matters come to our attention that have an impact upon our clients. Our team at Cordner Advisory are here to help you. Please reply to this email or phone us on 07 5504 5700 if you need any assistance.