Small Business Government Stimulus
The last few months have certainly been a minefield for small businesses, navigating not only how to survive but also all of the government packages being announced.
With the landscape changing weekly, it’s hard to know what to expect and more importantly, when. We’ve summarised what’s in, what’s out and the rules as they currently stand.
JOBKEEPER (EXTENDED) The JobKeeper scheme has been extended post 27 September, but at a different rate, with additional eligibility tests.
The good news is, the current scheme remains unchanged until the end of September. For those of you already in the system, you will continue to receive your monthly payments. There are three fortnights in August (paid in September) and two fortnights in September (paid in October) still to go under the existing scheme.
The existing scheme and the extension have been changed to include eligible employees who were employed permanently on 1 July, and those who meet the casual employee eligibility for longer than 12 months at 1 July. Previously this was 1 March.
In order to continue to be eligible for JobKeeper, from October to December you will need to re-pass the decline in turnover test. By showing that your income for July to September Quarter is down 30%. To be eligible between January and March 2021, you will need to prove 30% decline in turnover in October to December.
The rate for the extension is also changing.
From 28 September to 3 January, the rate will reduce to $1,200 per fortnight for those employees who worked more than 20 hours per week on average and $750 per fortnight for those who worked less. For those who continue to be eligible between January and March, the rate will reduce to $1,000 per fortnight for those employees who worked more than 20 hours per week on average and $650 per fortnight for those who worked less. The higher rate will be payable for employees who worked at least 20 hours per week in either the four weeks prior to 1 March OR 1 July 2020. So you need to go back to February, and June payroll and have a look at, on average, how many hours employees worked to determine what rate they will be paid.
The action now is to determine whether you have any additional eligible employees who meet the 1 July test.
Cashflow Boost – If you received the Cashflow Boost previously, you are also entitled to the same amount for Tranche 2. This will be paid to you in either two equal instalments, when you lodge your June BAS and October BAS or if you are a monthly payer, in 4 equal instalments between July and October.
Apprentice Rebate – The apprentice rebate has also been extended until 31 March. If you are receiving JobKeeper, you can’t also be paid the Apprentice Rebate, but for those who don’t qualify for the JobKeeper extension, you may be entitled to the Apprentice Rebate from 1 October to 31 March. This is 50% reimbursement of the apprentice’s wages up to a maximum of $7,000 per Quarter.
COVID Small Business Loans – The COVID Small Business Loans have been extended to 30 June 2021. These are the loans where the government guarantee 50% of the loan.
Rent Relief – If you are still eligible for JobKeeper, you are still under the National Code of Conduct for Rent Relief.
As always, these rules are changing, so make sure you check with your accountant to confirm your entitlements and how this impacts your cash flow or give Growthwise a call on 4927 8982 or visit www.growthwise.com.au
Steph is an accountant, technologist and co-founder of Newcastle accounting firm, Growthwise. Growthwise provide small business accounting on steroids that focuses on their client’s entire business to automate, streamline and improve their systems, processes and profits.