Economic Stimulus Package #2 – Details so far

Brealey Quill Kenny

We would like to assure all our clients that BQK is well prepared and able to continue to conduct our services and provide advice and guidance through these difficult times.

As of today, we will make arrangements for all existing appointments to be held via telephone, email, facetime, skype or video conferencing. Our office will remain open, should you need to drop information to us.

We have spent the past 7 days implementing and testing a range of remote access options to our software so we can continue to operate in the event of a lockdown. This will ensure our day to day services and ability to provide advice will continue uninterrupted.

We understand our assistance may be required more than ever and we are committed to providing the same diligent and timely advice to our clients as we navigate the weeks ahead together.

 

Federal Government Stimulus Package – What you need to know…

Individuals

Temporarily doubling of the Jobseeker Payment (previously called Newstart), providing people with an additional $550 a fortnight.

The payment will be available to sole traders and casual workers, provided they meet income tests. The Government will waive asset tests and waiting periods to access the Jobseeker Payment. Sole traders and casual workers who are currently making less than $1,075 a fortnight will be eligible to receive the full supplement.

Sole traders or casual workers who have had their income or hours reduced by 20 per cent or more as a result of coronavirus will also be able to access to up to $10,000 of their superannuation tax-free.

Cash for welfare recipients – $750 (announced in the first stimulus package) to be paid on March 31, with a further $750 to be paid on July 13.

Superannuation/Pensioners

Deeming rates reduced by a further 0.25 per cent. From the beginning of May, the lower deeming rate will be 0.25 per cent and the upper deeming rate will be 2.25 per cent.

To put things in perspective, when deeming rates were reduced by half a percentage point in the first stimulus package, it was estimated age pensioners would receive on average an additional $219 per year.

The Government will allow people to access up to $10,000 from their superannuation this financial year and in 2020-21.

People will not pay tax on the money they access, and withdrawals will not affect Centrelink or Veterans’ payments.

This will be limited to those unemployed and eligible to receive Jobseeker payments. There will be some concessions for small business owners.

There will also be a temporary 50-per-cent reduction in superannuation minimum drawdown requirements for account-based pensions in 2019-20 and 2020-21.

Small Business

Not-for-profits and small businesses with a turnover under $50 million will receive a tax-free cash payment of up to $100,000, with a minimum payment of $20,000 for eligible companies.

The payments will be delivered by the Tax Office as a credit on activity statements from late April and will be tied in with PAYG Withholding amounts for employees.

With companies reluctant to borrow, the Commonwealth is also offering to guarantee unsecured loans of up to $250,000 for a term of up to three years.

Payroll Tax paying businesses with a payroll between $1 million and $4 million will receive a one-off grant of $17,500 to assist them to manage the impacts of COVID-19.

In addition, the $1 million Payroll Tax threshold will be brought forward by six months to July 1, 2020.

Businesses impacted by COVID-19 can defer Payroll Tax payments until July 21, 2020 – the deferral is available to employers who pay $7.5 million or less in Australian Taxable Wages and have been directly or indirectly impacted by COVID-19, compared to normal operating conditions.

Please do not hesitate to contact our office in Canning Vale on 92562 777 if you have any questions with the above information.

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