In light of recent developments around the Coronavirus (COVID-19) and the uncertainty we are all facing day to day, we felt it important to email you to encourage you to reach out to our Advisers with any concerns you may have.
The targeted stimulus package announced last week is focused on keeping Australians in jobs and helping small and medium-sized enterprises to stay in business.
Increase in the Instant Asset Write Off
Increase the instant asset write off threshold from $30,000 to $150,000 and it has been expanded access to include businesses with an aggregated annual turnover of less than $500 million until 30 June 2020.
For example, assets that may be able to be immediately written off are tools for builders, a tractor for a farming business, and a truck for a delivery business. It’s perfectly acceptable to use borrowed funds (i.e. Equipment Finance) to fund the purchase.
Investment Incentive
The Government is providing a 15-month investment incentive (through to 30 June 2021) to support business investment and economic growth over the short term, by accelerating depreciation deductions. Businesses with a turnover of less than $500 million will be able to deduct 50 percent of the asset cost in the first year of purchase.
Support for Apprentices
Eligible employers can apply for a wage subsidy of 50 percent of the apprentice’s or trainee’s wage for up to 9 months from 1 January 2020 to 30 September 2020. Where a small business is not able to retain an apprentice, the subsidy will be available to a new employer that employs that apprentice.
Find out more: https://www.pm.gov.au/media/economic-stimulus-package
Payroll Tax (NSW)
For a business with Payrolls up to $10m, the NSW Office of State Revenue is waiving Payroll Tax up until 30 June. In addition, the Payroll Tax threshold will be increased to $1m commencing 1 July 2020
Cash flow assistance for businesses that employ staff
Employers will be entitled to payment up to $25,000 (minimum $2,000) for eligible small and medium-sized businesses. The payment will provide cash flow support to businesses with a turnover of less than $50 million that employ staff, between 1 January 2020 and 30 June 2020. The payment will be tax-free. Businesses will receive payments of 50 percent of their Business Activity Statements or Instalment Activity Statement from 28 April with refunds to then be paid within 14 days.
For those in Investment Markets
For those of you that are not Financial Planning clients, please do not hesitate to contact one of the Accounting Partners or Nick Grayson (Our Financial Planning Partner).
Nick (head of financial wealth) was cautious with clients in January due to equity markets being high and global risks present. Subsequently, Coronavirus transpired, and markets are being severely affected (more so than the global financial crisis).
Now the focus is on positioning clients for the opportunity that will present itself in the months ahead.
If you are unaware of how your Superannuation is invested or indeed if it is not being proactively managed – please reach out.