During this time of the COVID19 crisis, we understand that many of you will be dealing with the health and wellbeing of your family, staff, customers and community as well as the cashflow challenges for your business.
During this challenging time, we must all work together to protect the community and support local businesses.
The Federal and State Government, Banks and IBA have recently announced a range of measures to support small businesses. These measures are outlined below with links to the relevant agencies and programs for your information.
The new package comes less than a fortnight since the first round of economic stimulus measures were announced, with the aim of expanding support to more businesses, employees and individuals impacted directly or indirectly by the pandemic.
Key elements of the stimulus for small business:
• ‘Boosting Cash Flow for Employers’ expands to not-for-profit sector
• Government guarantee of unsecured loans up to $250,000
• New regulatory protections for impacted businesses
If you are a sole-trader
• The Government is temporarily expanding eligibility for income support payments. The supplement is to be paid at a rate of $550 per fortnight to existing and new recipients of the JobSeeker Payment, Youth Allowance jobseeker, Parenting Payment, Farm Household Allowance and Special Benefit.
• For people suffering financial stress as a result of COVID-19, the Government is allowing early access to superannuation. Eligible individuals will gain access to up to $10,000 through an online application in myGov before 1 July 2020, with a further $10,000 available after that date.
The JobKeeper stimulus package commits $130 billion to assist those businesses affected by the Coronavirus to get through the current crisis and maintain jobs.
The package provides a payment of $1,500 per employee per fortnight for the next 6 months.
Employers (including not-for-profits, self-employed/Sole Traders) will be eligible for the subsidy if:
- their business has a turnover of less than $1 billion and their turnover will be reduced by more than 30 per cent relative to a comparable period a year ago (of at least a month); or
- their business has a turnover of $1 billion or more and their turnover will be reduced by more than 50 per cent relative to a comparable period a year ago (of at least a month); and
- the business is not subject to the Major Bank Levy.
Employers must elect to participate in the scheme. They will need to make an application to the Australian Taxation Office (ATO) and provide supporting information demonstrating a downturn in their business. In addition, employers must report the number of eligible employees employed by the business on a monthly basis.
Eligible employers will receive the payment for each eligible employee that was on their books on 1 March 2020 and continues to be engaged by that employer – including full-time, part-time, long-term casuals and stood down employees. To be eligible, an employee must be an Australian citizen, the holder of a permanent visa, a Protected Special Category Visa Holder, a non-protected Special Category Visa Holder who has resided in Australia for 10 years or more, or a Special Category (subclass 444) Visa Holder).
It is recommended that affected businesses register their interest immediately to join the scheme at https://www.ato.gov.au/General/Gen/JobKeeper-payment/
Further information on the Federal Government response plan can be found at: https://treasury.gov.au/coronavirus/businesses
Aside from national measures, the State government has released its own stimulus package, which includes an unprecedented amount of assistance for the SME sector and community organisations.
- freezing household fees and charges — including electricity, water, vehicle charges, the emergency services levy and public transport fees
- One off $2,500 credit on electricity bills for 95,000 small businesses – available for customers that consume less than 50MWh per annum.
- Power and water disconnections will not occur and interest will not be charged on deferred payments until 30 September 2020.
- Payroll tax grants – A one-off grant of $17,500 will be available for employers, or groups of employers, whose annual Australian taxable wages are more than $1 million and up to $4 million.
- Payroll tax deferral for ‘affected’ businesses – Western Australian businesses affected by the coronavirus outbreak may also be eligible to defer their payroll tax payments until July 21, 2020.
- Payroll tax will be waived for four months for small-to-medium sized businesses with annual wages of under $7.5 million.
- A range of licence fees will be waived for small & medium businesses in impacted industries.
- Businesses can apply for interest-free payment arrangements and for late payment penalties to be waived for a range of taxes and duties.
Details of the WA Government response plan can be found at: https://www.wa.gov.au/organisation/department-of-the-premier-and-cabinet/coronavirus-covid-19-western-australian-government-response
Australian Banks have hardship teams ready to help.
- Australians affected by the outbreak of COVID-19 can temporarily defer their loan repayments for up to six months.
- Most banks are offering relief for those who have fallen ill, lost their job, or have had their income reduced due to the coronavirus.
- While no repayments will have to be made during the ‘freeze’ period, interest will continue to accrue. This means interest will be charged as per normal each month on the full value of loan.
More details can be found by contacting your bank relationship manager or at: https://www.ausbanking.org.au/campaigns/financial-hardship/
For IBA customers who have a start-up package, business loan or equipment finance product through IBA and have currently been significantly impacted by the COVID-19 situation, you will be able to apply for the following assistance:
- Deferral of business loan and lease payments for an initial four-month period
- Waiver of interest on business loans and leases for an initial four-month period
- Special assistance for customers experiencing hardship, including loan restructuring, reassessment of loan terms and assistance accessing other federal, state and territory government stimulus packages.
Further Information can be found at: https://www.iba.gov.au/2020/03/covid-19-support/
IBA is also announcing a new support package for all Indigenous businesses who have been impacted by the crisis, including non-IBA customers. This new support package has been designed in collaboration with the National Indigenous Australians Agency (NIAA) to respond to the immediate challenges Indigenous businesses are currently facing. This package includes:
- Access to specialist advice: to help your business navigate the COVID-19 crisis, IBA can provide specialist advice including a rapid assessment of business positioning, cashflow management and assistance to access available stimulus measures.
- Working capital assistance: If you are not eligible for other government stimulus packages, you can apply for working capital assistance of up to $100,000 via a loan/grant package (assessed on a needs basis), which will consist of:
- A grant of up to 50% of the package amount;
- For the loan component, up to 36 months loan term, zero repayments for the first 12 months, and preferential interest rates thereafter
This new support package for Indigenous businesses will be available from 9 April 2020. For more information and to register your interest in applying for this package please visit: https://www.iba.gov.au/indigenous-business-australia-covid19-support/
We are all in this together and we will continue to provide important information, updates and support to our clients and the Aboriginal Business Sector.
If you need any help accessing Federal or State Government support for your business including the JobKeeper Payment, please reach out to the Wirra Hub team on the following contacts:
Shane Devitt: Mobile 0418 474 098 or Email Shaned@wf.org.au
Raylene Bellottie: Mobile 0417 732 169 or Email RayleneB@wf.org.au
Kim Bridge: Mobile 0418 855 548 or Email Kimberleyb@wf.org.au
Shirley McPherson: Mobile 0417 801 255 or Email ShirleyM@wf.org.au
Robert Barton: Mobile 0459 271 268 or Email RobertB@wf.org.au