Government Support to Business - Activity Statements & Payroll Tax

The Australian Government has released details of the Stimulus Package to assist Australian businesses experiencing financial difficulty as a result of the Coronavirus outbreak. Here are a few measures that will affect the upcoming activity statements and payroll tax returns.

ATO - Cash Flow Assistance for Business

This initiative will provide a relief of PAYG Withholding Tax payable from a minimum of $2,000 up to $25,000 to eligible businesses that employ staff between 1 January 2020 to 30 June 2020.

Who is eligible for the Cash Flow Assistance?
Businesses who employ staff whose turnover is less than $50 million per annum.

How is the Cash Flow Assistance provided?
Eligible businesses will receive a payment equal to 50% of the amount withheld with a minimum payment of $2,000 up to a maximum of $25,000. The 50% rebate only applies to the PAYG – Withholding lodged between January and June 2020.

Quarterly Lodgers
The ATO will issue a credit to the Business’ Integrated Client Account upon lodgement of both the March 2020 and June 2020 Activity Statements, up to the $25,000 cap.

Monthly Lodgers
The credit for monthly lodgers will be calculated at three times the rate (150%) of the PAYG lodged in their March 2020 Activity Statement. Thereafter a 50% credit will apply to the PAYG lodged monthly between April and June 2020, up to the $25,000 cap.

Do businesses need to apply or register for the Cash Flow Assistance?
No. There is no registration or application process. The ATO will simply credit the Integrated Client Account of all businesses who satisfy the eligibility requirements.

Is the $25,000 limit applicable to each Activity Statement or the eligibility period?
The $25,000 is applicable to the PAYG lodged over the six month period (January to June 2020).

For more information read the Factsheet.

Revenue NSW – Payroll tax

NSW Premier Gladys Berejiklian has now committed $450 million to waive the payroll tax for businesses with payrolls of up to $10 million for three months ending 30 June

2020 (April, May and June 2020). Further, the NSW government will bring forward the raising of the payroll tax threshold to $1 million from 1 July 2020, up from $900,000 and one year earlier than planned.

ATO - Assistance to Businesses affected by COVID-19

Additional options available to assist businesses impacted by COVID-19 include, the ability to apply for the following:

Super Obligations
Employers will still need to meet their ongoing super guarantee obligations for their employees,. No deferrals or extensions have been granted for these payments.

Assistance for Severely Affected Regions
The Government has set out aside $1 Billion to support regions disproportionately affected by the impact of the Coronavirus, including industries such as Tourism, Agriculture and Education.
The ATO will provide administrative relief for certain tax obligations (similar to relief provided following the bushfires) for taxpayers affected by the Coronavirus outbreak, on a case by case basis.

Assistance provided by Financial Institutions
Additional assistance has also been offered by a number of Banks and Financial Institutions. Please contact your Bank or Bank Manager for more information.

The material and contents provided in this publication are informative in nature only.  It is not intended to be advice and you should not act specifically on the basis of this information alone.  If expert assistance is required, professional advice should be obtained