The government is providing up to $100,000 to eligible small and medium sized businesses that employ people with a minimum payment of $20,000. This measure has been announced in the two economic response packages.
The cash flow boost is based upon the amount of tax withheld from wages and reported to the Australian Tax Office on Instalment Activity Statements and Business Activity Statements from March 2020 to October 2020.
The cash flow boost provides a tax free payment to employers and is automatically calculated by the ATO. No additional forms, lodgements or applications are required.
Eligibility - Initial Payment (First Government Announcement)
To be eligible you must be a small to medium business entity with annual turnover of less than $50 million and employ workers. The turnover threshold will be based on your 2019 turnover.
- The payment will be delivered by the ATO as an automatic credit in the Activity Statement System from 28 April 2020 upon lodgement of eligible activity statements.
- Eligible employers that withhold tax from wages/salary and remit that tax to the ATO will receive a payment equal to 100% of the amount withheld, up to a maximum of $50,000.
- Eligible employers that pay salary and wages will receive a minimum payment of $10,000 even if they are not required to withhold tax. (i.e. all your employees wages are under the threshold)
- The payments will only be available to eligible active employers established prior to 12 March 2020.
- Quarterly lodgers will be eligible to receive this payment for the March and June 2020 lodgements.
- Monthly lodgers will be eligible to receive this payment for the March, April, May and June 2020 lodgements. To provide an equal treatment to the quarterly lodgers the March 2020 payment will be calculated at 3 times the march lodgement amount.
- The minimum payment will be applied to the entities first lodgement.
Eligibility - Additional Payment (second Government Announcement)
To be eligible for the additional payment you must continue to be an active employer.
- For monthly activity statement lodgers the additional payments will be an automatic credit in the activity statements system. The amount will be equal to 4 payments of 25% of the total amount received under the initial payment scheme (as outlined above). This amount will be received on lodgement of the June, July, August and September activity statements. (up to a total of $50,000)
- For quarterly activity statement lodgers the additional payments will be an automatic credit in the activity statement system. The amount will be equal to 2 payments of 50% of the total amount received under the initial payment scheme (as outlined above). This amount will be received on lodgement of the June and September 2020 activity statements (up to a total of $50,000).
- Where the payment places the business into a refund position, the ATO will deliver the refund within 14 days.
Additional relevant information
- The payments are tied to lodgement of your activity statements. Please ensure you lodge them in a timely manner or where we assist you have the information available to us as soon as practicable after the end of the month/quarter.
- The payment is delivered as a credit into the tax system. It will be allocated in the tax system to assist in paying your activity statement and then applied to other outstanding debts in your integrated client account. IT WILL ONLY BE REFUNDED IF YOU ARE IN A REFUND POSITION IN YOUR INTEGRATED CLIENT ACCOUNT.
SUPPPORTING APPRENTICES AND TRAINEES
The government is providing assistance for small business to retain their apprentices and trainees.
- The assistance/subsidy is available to small businesses employing fewer than 20 full time employees who also employ an apprentice or trainee.
- The apprentice or trainee must have been employed as at 1 March 2020.
- The subsidy is 50% of the apprentice or trainee wage paid during the 9 month period of 1 January 2020 to 30 September 2020.
- The maximum amount per apprentice or trainee is $21,000 or $7000 per quarter.
- Employers will need to have an eligibility assessment undertaken by an Australian Apprenticeship Support Network provider.
- Employers can register for the subsidy in April 2020 and final claims lodged by 31 December 2020.
- Further information available at:
- The Department of Education, Skills and Employment: www.dese.gov.au
- Australian Apprenticeships Website: http://www.australianapprenticeships.gov.au
ADDITIONAL INFORMATION
For additional information regarding the above we have inserted the government fact sheets in the resources section of our website. These provide examples that may assist you in determining you eligibility and how it may apply to you.
If you wish to discuss any of the above in relation to you specific situation please feel free to contact our office by phone or email.