As the Governments initial outlook on the economy has deteriorated from the original ‘Stimulus Package’ announcement on 12 March 2020, the government yesterday announced a second Coronavirus stimulus package totalling $189 billion.   

Boosting Cash flow for employers

The Australian Government has increased their existing stimulus package to include:

• An increase of a cash flow payments to eligible employers of up to $50,00, up from $25,000. The calculation is now also amended to be a 100% subsidy rather than 50% of the tax withholding for the period 1 January 2020 to 30 June 2020.
• An inclusion of not-for-profit entities and charities as eligible employers.
• Minimum payments for employers have increased from $2,000 to $10,000.
• An additional payment is also being introduced in the July to October 2020 period where eligible entities will receive a payment equal to the total of all the ‘Boosting Cash flow for Employers’ payments that they previously received.
• The payments will only be available to active eligible employers established prior to 12 March 2020.

Income support for individuals and households

The Australian Government is expanding the eligibility of income support payments and established a new time limited Coronavirus supplement payment.

• For the next six months, a Coronavirus supplement payment of $550 per fortnight for individuals on Jobseeker, parenting payment, farm allowance and special benefit recipients.
• An additional second payment of $750 from 13 July 2020 for individuals who were previously eligible for the first round of government support payments.

Support for Retirees and Superannuation

Early access to superannuation for eligible individuals and more flexible arrangements in relation to minimum drawdowns have been proposed by the government to help manage the impact of the volatile financial markets on their retirements savings.

• Temporarily reducing superannuation minimum drawdown requirements for account-based pensions and similar products by 50% for the 2020 and 2021 financial years.
• Eligible individuals will be able to apply online via myGov to access up to $10,000 tax free from their superannuation before 1 July 2020. A further $10,000 will be able to be accessed from 1 July 2020.
• Eligible individuals include:
  • If you are unemployed;
  • If you are eligible for the jobseeker, parenting payment, farm allowance or receive special benefit payments;
  • If after 1 January 2020:
    • you were made redundant;
    • your working hours were reduced by 20% or more;
    • if you are a sole trader and your business was suspended or your turnover was reduced by 20% or more.

Support for Retirees and Superannuation

The Victorian Government will provide full payroll tax refunds for the 2020 financial year to small and medium-sized business where their total payroll remuneration is less than $3 million. Payroll tax refunds of up to $113,975 for the 2020 financial year are proposed to start flowing next week. Furthermore, the same eligible businesses will also be able to defer the payroll tax payments for the September 2020 quarter to 1 January 2021.

If you have any enquiries in relation to the above Government announcements, please contact our office 03 9629 1433.