What the latest Australian government relief packages mean for you
by Veena Prakash
In this post, we have attempted to collate these offerings, and the latest support packages by the Victorian Government to help you get through this extremely difficult time.
Please keep in mind that there is still a lot of ‘grey area’ around much of the legislation.
So, if you are interested in accessing support - your next step should be to speak with a relevant advisor (accountant, personal banker, etc) or with the government institution directly.
We’re closely monitoring announcements and will update this article accordingly.
BUSINESSES
VIC
(Updated on 15 September 2020)
Business adaptation support
The Victorian Government has released grants of up to $20 million to help small businesses adapt to online operations. This allows eligible businesses to access off-the-shelf digital programs like Shopify or Squareonline, training, and workshops needed to thrive online under a COVID normal.
At this stage, details about eligibility and accessing this funding are yet to be provided.
If you need further information to support your application (eg. a quote for an online store) please contact us here or call 1300 061 513.
Business Support Fund- Third round
The third round of the Business Support Fund offers grants ranging from $10,000 to $20,000 for Victorian businesses. Eligibility is dependent on the business' annual payroll. Applications open on 18 September 2020.
WA
Payroll Tax Relief Grant - $17,500
The WA Government has announced this one-off grant for businesses with annual taxable wages between $1 million and $4 million. For businesses with taxable wages below $7.5 million, Payroll tax will be waived between March and June.
AUSTRALIA WIDE
Budget Direct Sponsorship Solved Grant - Up to $10,000
Businesses that require sponsorship to support local communities may be eligible to apply for a Budget Direct sponsorship of $1000, $2500 or $5000. The next round of applications closes on 30 September 2020.
Damien Green Lawyers Community Grant - $1000
Damien Green Lawyers is inviting organisations via a closed non-competitive process to apply for a Community Grant of $1000 in 2020. The program aims to recognise and celebrate organisations that strive to make a positive impact within their local community. Applications close on 15 November 2020.
Boosting Cash Flow for Employers - Up to $100,000
Eligible businesses can receive tax-free cash flow boosts of between $20,000 and $100,000. This will be delivered through credits when businesses lodge their activity statements.
JobKeeper Payment
The Federal Government will provide a wage subsidy of $1,500 per fortnight (before tax) to workers who will receive it through their employer. Businesses significantly affected by COVID-19 may be eligible to receive the payment for up to six months, for each eligible employee.
Wage Subsidy for Apprentices and Trainees
To help small businesses retain their apprentices and trainees, the government is providing a wage subsidy of 50 percent of their remuneration for 9 months from 1 January 2020 to 30 September 2020. To be eligible, the business will be employing fewer than 20 full-time staff who retain a registered apprentice or trainee.
Temporary Relief to Businesses Facing Financial Distress
- The government has made a temporary increase in the minimum threshold at which a statutory demand can be issued by creditors - from $2000 to $20,000 for six months. Companies currently also have an extended time frame to respond to statutory demands from creditors - from 21 days to six months.
- Additional relief is available for holding companies and directors from any personal liability for debts incurred when trading while insolvent. This applies for six months only for debts incurred in the ordinary course of the company’s business.
- The treasurer will be given a temporary instrument-making power to amend provisions of the Corporations Act 2001 temporarily. This aims to provide relief from specific obligations or the ability to modify obligations in order to enable compliance with legal requirements during this crisis.
LOANS
Guarantee Scheme for SME Lenders
It is easier to apply for business loans with the government’s cash flow assistance. A guaranteed 50 percent of loan proceeds will be available to small and medium business lenders to support new short-term unsecured loans. Commencing by early April 2020, the scheme will offer loans up to $250,000 per borrower, with a term of up to three years and a six month repayment holiday.
Quick and Efficient Access to Credit
A six-month exception from responsible lending is applied to any credit to small businesses to be used for business purposes, including new credit, credit limit increases, credit variations and restructures.
Supporting the Flow and Reducing the Cost of Credit
The Reserve Bank of Australia (RBA) will put downward pressure on borrowing costs for businesses and households. Banks will be able to access funding at a 0.25 percent fixed interest rate to reinforce the benefits of a low cash rate, which translates to reduced interest rates for borrowers.
INDIVIDUALS AND HOUSEHOLDS
Working for Victoria Fund
Under the Victorian Government’s $500 million fund, workers who have lost their jobs will be eligible to apply for paid work across various sectors to contribute to Victoria’s ability to support the community and manage this event.
Support for Households
Social security, veteran, other income support recipients, and eligible concession cardholders can access two separate payments of $750 - first payment from 31 March 2020 and the second from 13 July 2020.
Reduction in Pension Minimum Drawdown Requirement
The minimum drawdown rate is temporarily reduced by 50 percent for account-based pensions and similar products for 2019-20 and 2020-21.
Reduction in Pension Deeming Rates
There is a reduction in both upper and lower pension deeming rates by 0.75 percent (which includes the 0.5 percent reduction announced on 12 March).
REFERENCES USED IN THIS ARTICLE:
The Treasury - Economic Response to the Coronavirus
The Treasury - $130 billion JobKeeper payment to keep Australians in a job
Highview Accounting & Financial - The latest on the Coronavirus Stimulus Package - what it means for you
City of Melbourne - COVID-19 business grants
Business Victoria - Business Support Fund
State Revenue Office Victoria - Tax relief for eligible businesses
