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Jobkeeper Stimulus Package

The Jobkeeper package is a $1,500/fortnight wage subsidy for employers in respect of employees who suffer a reduction in work or are stood aside as a result of the COVID-19 economic slowdown and is backdated for employees stood aside from jobs since 1 March 2020.

Eligible are businesses which have had a reduction of income of 30% or more since March 2020 over a minimum comparable one month period. Employers will be able to apply for the $1,500 payment for each employee on its books on 1 March 2020, and the payment will then need to be given to employees.

Commencement will be 30 March 2020 with jobkeeper payments to be received by businesses by the first week of May, and payments made now to be reimbursed from the first week in May.

Businesses include companies, trusts, partnerships, sole traders, not for profits and charities.

Employees eligible are full time, part time employees including stood down employees and casual employees who have been with their employer for at least the previous twelve months. Self-employed individuals are also eligible.

Australian residents, New Zealand citizens in Australia who hold a subclass 444 special category visa, and migrants who are eligible for the Jobkeeper Payment or Youth Allowance (other) are all eligible for the Jobkeeper Payment.

Employers must register an intention to apply on the ATO website: https://www.ato.gov.au/Job-keeper-payment

Coronavirus Stimulus Package

Household Support

Payments to Individuals

Payments of $750 to social security, veteran and other income support recipients and eligible concession card holders.

1st payment from 31/03/2020.

2nd payment from 13/07/2020 (not available to those eligible for the Coronavirus supplement).

Subsidy For Apprentice/Trainee Wages

Eligible businesses can apply for 50% subsidy of wages for the 9 month period 1 January 2020 to 30 September 2020.

Early Access to Superannuation Allowed

Individuals affected by the Coronavirus able to access up to $10,000 of their superannuation in 2019/2020 and a further $10,000 in 2020/2021 – no tax payable and withdrawals will not affect Centrelink or Veteran Affairs payments, however conditions apply.

Minimum Superannuation Drawdown Rates

Reduced by 50% for 2019/2020 and 2020/2021.

Social Security Deeming Rates Reduction

Reduced lower rate 0.25% reduced upper deeming rate 2.25% from 1 May 2020.

Coronavirus Stimulus Package

Jobseeker Payments (Formerly Newstart)

Payments will temporarily double providing an additional $550/fortnight with assets tests and waiting periods waived.

Available to sole traders and casual workers provided they meet income tests.

Small Business Employer Support

Not for profits and small businesses (turnover <$50million) that employ workers will receive a tax free cash payment of up to $100,000 with a minimum payment of $20,000 to eligible businesses; payments will be delivered by the ATO as a credit on activity statements from late April, based on PAYGW reported, with an additional and equal payment in the July to October 2020 period.

The Commonwealth government is offering a guarantee of 50% of unsecured loans up to $250,000 for up to three years for small business for working capital.

Instant Asset Write Off

The $30,000 threshold is being increased to $150,000 for all businesses for assets purchased for use in the business and first used or ready to use by 30 June 2020!

Accelerated Depreciation Allowance

This investment incentive of 50% write off for eligible assets will apply from 12 March 2020 and be available until 30 June 2021 – existing depreciation rules would continue to apply to the balance of the assets cost.

Should you be affected by the Coronavirus crisis and want further information regarding the government Coronavirus stimulus package, please CONTACT US TODAY .

State payroll tax changes

State payroll tax has traditionally been seen as a deterrent to employment, but new government legislation recently introduced to Parliament should provide some welcome payroll tax relief for WA businesses.

The legislation to change the threshold at which the state payroll tax applies sees an increase from the present threshold of $850,000 to $950,000 on and from 1 January 2020.

Assuming Parliamentary approval for the change to the state payroll tax threshold, this is welcome news for employers, as is the proposed further increase from $950,000 to $1,000,000 which will apply from 1 January 2021.

Any easing in the application of state payroll tax is good news and a step in the right direction!

Of course, the bad news is that the tax is applied against not only wages but also allowances, employee benefits in general, and even employee superannuation!

Downsizer superannuation contributions

Downsizer superannuation contributions

Individuals over 65 years of age can make one-off contributions of up to $300,000 ($600,000 per couple) from the sale of their main residence, provided the property was owned for at least ten years, including just before sale.

This applies to contracts entered into after 1 July 2018 and where the contribution is made within 90 days of the sale, i.e. settlement!  Unless there is a delay caused by factors outside the individual’s control, it is most unlikely any extension to the 90 days would be available, so the timing of the contribution is critical.

Downsizer superannuation contributions are simply capped at $300,000, take no account of the concessional $25,000 maximum, the non-concessional $100,000 maximum; the ‘work test’ doesn’t apply to downsizer superannuation contributions, there is no upper age limit and the contribution can be made irrespective of any total superannuation balance, even if $1.6m or more!

Should you be able to take advantage of this one-off downsizer superannuation contributions opportunity, please CONTACT US .

New tax offset – LAMITO

In the 2019–20 Federal Budget the Government announced its intention to change and build on the Personal Income Tax Plan.  These changes are now law and include a new tax offset!

Low and middle income tax offset (LAMITO)

This tax offset was introduced in the 2019 financial year and is in addition to the low income tax offset.  A taxpayer may be entitled to both (or part thereof).

A tax offset of $255 is available where your taxable income is between $0 and $37,000.

Where your taxable income lies between $37,000 and $48,000, the tax offset available is $255 plus 7.5% of the amount over $37,000.

A tax offset of $1,080 is available for taxpayers with a taxable income between $48,000 and $90,000.

Thereafter the tax offset is reduced by 3% of the amount over $90,000.

Taxable income over $126,000 attracts no tax offset.

It is important to note that, as a non-refundable offset, any unused LAMITO cannot be refunded.  It will directly reduce the amount of tax payable but does not reduce the Medicare levy.  If not all the offset is used to reduce the tax payable, there is no refund of any unused portion.

The amount of the offset you may be entitled to and the amount of any refund will differ for everyone, depending on individual circumstances such as your income level and how much tax you have paid throughout the year.