In response to the coronavirus pandemic, the Australian Government has announced a $17.6 billion economic stimulus package to help the economy and local businesses. The key drivers for small business are incentives for investment in new assets, and payroll support to keep your staff employed. There are 4 key measures for business, and an additional offer for households.

Expanded Instant Asset Write-Off (up to $500m turnover)

Right now you can deduct outright any asset costing up to $30,000 if you are a small or medium business with turnover up to $50m. The proposed enhancement will increase the asset limit to $150,000, the turnover limit to $500m, and you can immediately write-off multiple assets. This measure will run from 12 March 2020 until 30 June 2020.

Ongoing investment – 50% initial deduction (up to $500m turnover)

For the next 15 months, if you cannot immediately deduct the asset outright, you can instead claim 50% as a deduction up front. The balance of the cost will be depreciated under the normal measures. This would be 15% in the first year, and 30% of the balance each year after if your turnover is under $10m, otherwise over the asset’s effective life. This will be available for business up to $500m turnover and until 30 June 2021.

Payroll incentive (up to $50m turnover)

Small and medium businesses with turnover up to $50m will get a 50% rebate on PAYG on their activity statements. The minimum will be $2,000 and up to $25,000. This payment to the business will be tax free, and will run for a period of 4-6 months.

Apprentice and trainee support (up to 20 FTE staff)

To help retain apprentices and trainees, a subsidy of 50% of wages, up to $21,000 over 9 months. To be eligible you need to employ 20 or fewer full time equivalent (FTE) employees and retain an apprentice or trainee. If the employer cannot retain, the subsidy will be available to a new employer.

$750 stimulus payments

A payment will be made from 31 March, to 6.5 million lower income Australians receiving government assistance. This will include pensioners, concession card holders, and certain job seekers including some of those unable to work due to the pandemic.

Further help:

We will provide a more detailed explanation on the stimulus package as soon as the information is available. Should you have any questions about how these measures affect you or your business, please contact us for further advice. You can reach us on (07) 3023 4800 or at mail@marshpartners.com.au.

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