Legislation will be introduced by the Federal Government in the parliamentary sitting week commencing 21 March 2020. The Government appears confident that these measures will be passed by the upper and lower houses.
I have summarised the 6 elements of the stimulus package. Detailed information can be found on the Treasury website, here.
I hope that you find this helpful.
Instant asset write-off increase
Effective immediately, the Government is increasing the instant asset write-off threshold from $30,000 to $150,000 and expanding access to include businesses with aggregated annual turnover of less than $500 million (up from $50 million) until 30 June 2020.
The threshold applies on per asset basis, so eligible businesses can immediately write-off multiple assets.
Accelerating depreciation deductions
A time limited 15 month investment incentive to support business investment and economic growth over the short-term, by accelerating depreciation deductions.
The key features of the incentive are:
• benefit — deduction of 50 per cent of the cost of an eligible asset on installation, with existing depreciation rules applying to the balance of the asset’s cost;
• eligible businesses — businesses with aggregated turnover below $500 million; and
• eligible assets — new assets that can be depreciated under Division 40 of the Income Tax Assessment Act 1997 (i.e. plant, equipment and specified intangible assets, such as patents) acquired after announcement and first used or installed by 30 June 2021.
Does not apply to second-hand Division 40 assets, or buildings and other capital works depreciable under Division 43.
Wage assistance for employers of apprentices & trainees
Eligible employers can apply for a wage subsidy of 50 per cent of the apprentice’s or trainee’s wage paid during the 9 months from 1 January 2020 to 30 September 2020.
Employers will be reimbursed up to a maximum of $21,000 per eligible apprentice or trainee ($7,000 per quarter).
The subsidy will be available to small businesses employing fewer than 20 full-time employees who retain an apprentice or trainee. The apprentice or trainee must have been in training with a small business as at 1 March 2020.
Employers of any size and Group Training Organisations that re-engage an eligible out-of-trade apprentice or trainee will be eligible for the subsidy. Employers will be able to access the subsidy after an eligibility assessment is undertaken by an Australian Apprenticeship Support Network (AASN) provider.
Where a small business is not able to retain an apprentice, the subsidy will be available to a new employer.
Wage assistance for SMEs
Small and medium business entities with aggregated annual turnover under $50 million and that employ workers will be eligible.
Eligibility will generally be based on prior year turnover.
• The payment will be delivered by the Australian Taxation Office (ATO) as a credit in the activity statement system from 28 April 2020 upon businesses lodging eligible upcoming activity statements.
• Eligible businesses that withhold tax to the ATO on their employees’ salary and wages will receive a payment equal to 50 per cent of the amount withheld, up to a maximum payment of $25,000.
• Eligible businesses that pay salary and wages will receive a minimum payment of $2,000, even if they are not required to withhold tax.
One-off payments to income support recipients
A one-off $750 payment to eligible people.
To be eligible, you must be residing in Australia and be receiving one of the following payments or hold one of the following concession cards on 12 March 2020:
• Age Pension
• Disability Support Pension
• Carer Payment
• Parenting Payment
• Wife Pension
• Widow B Pension
• ABSTUDY (Living Allowance)
• Bereavement Allowance
• Newstart Allowance
• Youth Allowance
• Partner Allowance
• Sickness Allowance
• Special Benefit
• Widow Allowance
• Family Tax Benefit, including Double Orphan Pension
• Carer Allowance
• Pensioner Concession Card holders
• Commonwealth Seniors Health Card holders
• Veteran Service Pension; Veteran Income Support Supplement; Veteran Compensation payments, including lump sum payments; War Widow(er) Pension; and Veteran Payment.
• Veteran Gold Card holders
• Farm Household Allowance
Where someone has lodged a claim for one of the eligible payments or concession cards by 12 March 2020, and the claim is subsequently granted, they will also receive the one-off payment.
Assistance for severely affected regions
$1 billion has been allocated to support those regions and communities that have been disproportionately affected by the economic impacts of the Coronavirus, including those heavily reliant on industries such as tourism, agriculture and education.
The $1 billion will be provided through existing or newly established Government programs. Amongst other measures, this will include assistance to help businesses identify alternative export markets or supply chains.
The Minister for Trade, Tourism and Investment will work with affected industries and communities to develop recovery plans and measures.
As always, the above information isn’t legal advice. Please get in touch if you’d like legal advice on your particular situation.
This article was first published on the Twine Business and Law website. For more information from Twine Business and Law and the services they provide, please visit their website at https://www.twinebl.com
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This article does not constitute legal advice or a legal opinion on any matter discussed and, accordingly, it should not be relied upon. It should not be regarded as a comprehensive statement of the law and practice in this area. If you require any advice or information, please speak to a practising lawyer in your jurisdiction. No individual who is a member, partner, shareholder or consultant of, in or to any constituent part of Legally Yours Pty Ltd accepts or assumes responsibility, or has any liability, to any person in respect of this article.