On Thursday, 12th March 2020, the Morrison Government announced a $17.6 billion economic plan to support jobs, businesses and households considering the challenges posed by the spread of the coronavirus.
This new stimulus package is good news for small businesses and is designed to help boost cash flow. Around $8 billion will be invested to help small to medium-sized employers, with two specific measures:
1. Automatic, tax-free payment of up to $25,000
This will apply to businesses that employ people and have a turnover of up to $50 million. It will be delivered to businesses automatically through the tax system, meaning that no new forms will be required.
Up to 700,000 businesses and 7.8 million workers are estimated to benefit from this measure.
2. 50% wage subsidy
This will apply for apprentices and businesses with less than 20 employees. Employers will receive up to $21,000 per apprentice.
Additionally, the government is investing $700 million over the next four years to expand the instant asset write-off.
- The instant asset write-off threshold will be raised from $30,000 to $150,000
- Access to instant asset write-off will be expanded to businesses with an annual turnover of $500 million.
- Any purchases from now until 30 June (including truck, tractor, shop fit out) can be written off immediately.
- There will also be a 50 per cent accelerated depreciation deduction over and above what businesses can already deduct in the first year and is available for 15 months to 30 June 2021.
If you need advice about how the stimulus package applies to your business, please contact us.