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OncoreMarch 13, 20201 min read

Australian Government has announced a $17.6b stimulus package in response to COVID-19

In response to the spread and impact of COVID-19, The Scott Morrison Government has announced a $17.6b stimulus package in an attempt to keep the economy stimulated during this time of the coronavirus pandemic.

Some of the key packages include the following:

  • Instant asset write-off will increase from $30,000 to $150,00 up to 30 June 2020. Businesses with a turnover of up to $500 million will now be eligible for this instant asset write off, previously only granted to those with a turnover of up to $50 million.In a communication today by APSCO, legal firm Sovereign Private has stated, “now is the time to consider larger asset purchases (both new and second hand). The increase in the turnover threshold will assist many agencies that were previously precluded from accessing these concessions on the basis their contractor revenue generally pushed them over the turnover threshold. Purchases that would be eligible include new office fit-outs, IT systems, office equipment etc.”
  • Businesses with a turnover of up to $500 million will now be able to deduct an additional 50% of the asset cost in the year of purchase. This incentive will be available until 30 June 2021.
  • Small to medium-sized entities who have a turnover of less than $50 million, will receive tax-free payments of at least $2,000 and up to a maximum $25,000. The value of the payment will depend on the amount of pay-as-you-go tax businesses withhold on employee’s salaries and wages. This will be delivered via your Business Activity Statement from 28 April 2020.

As a result of the stimulus package, the ATO has also announced some relief for taxpayers:

  • Up to a four-month deferral of the payment date of amounts including PAYG instalments, income tax assessments, fringe benefits tax assessments and excise
  • Where businesses currently lodge their Business Activity statement quarterly, they will be eligible to lodge monthly to allow them access to their GST refunds quicker.
  • Businesses will be allowed to vary their PAYG instalments amounts to zero for March 2020 quarter, and in doing so, also be allowed to claim a refund on any instalments paid on the Sep ’19 and Dec ’19 activity statements.
  • Any interest or penalty charges from 23 January and onwards that have been applied to tax liabilities will be remitted.

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