Weekly Digest – 23 September 2020
Welcome back to our Weekly Digest. We hope you and your family are safe and doing well. Read on for this week’s update.
Second Round of Cash Flow Boost
If you have received initial cash flow boosts, you will automatically get a second round of cash flow boost when you lodge your activity statements for each monthly or quarterly period from June to September 2020.
If you lodge:
- quarterly, you’ll receive 50% of your total initial cash flow boost for each activity statement
- monthly, you’ll receive 25% of your total initial cash flow boost for each activity statement.
Upon lodgement we will notify you of your obligations and/or refunds and can assist in managing any outstanding debt if needed.
Reminder: JobKeeper and JobSeeker Changes from 28 September
The Australian Government announced that JobKeeper and JobSeeker payments will be extended, with changes starting on 28 September 2020. Below is a rundown of the changes to expect on these support schemes.
Changes to JobKeeper
The JobKeeper scheme will continue until 28 March 2021. The extension of the scheme will operate in two separate periods:
- Extension 1: 28 September 2020 to 3 January 2021
- Extension 2: 4 January 2021 to 28 March 2021
JobKeeper Extension 1
The tier 1 payment rate of $1,200 per fortnight applies to:
- Employees who worked for 80 hours or more in the four weeks of pay periods before either 1 March 2020 or 1 July 2020
- Eligible business participants who were actively engaged in the business for 80 hours or more in February and provide a declaration.
For any other eligible employees or business participants, the tier 2 payment rate of $750 per fortnight will apply.
JobKeeper Extension 2
For extension 2, payment rates will be further reduced to:
- $1,000 per fortnight for tier 1 employees and business participants
- $650 per fortnight for tier 2 employees and business participants
The ATO website provides further information about the eligibility requirements for the extension 2 period.
Decline in Turnover Test
Both these extension periods will require satisfaction of an additional actual decline in GST turnover test as follows.
Extension 1 (28/09/2020 – 03/01/2021)
September Quarter (Jul, Aug, Sept) relative to comparable period (usually same 2019 Q)
Extension 2 (03/01/2021 – 28/03/2021)
December Quarter (Oct, Nov, Dec) relative to comparable period (usually same 2019 Q)
For further details about the eligibility requirements for the JobKeeper extension 1, please refer to the Australian Taxation Office (ATO) website.
How does this differ from the original JobKeeper test?
- The decline in turnover must be demonstrated for specific quarters only .
- Rather than using projected GST turnover for the relevant quarter being tested, you use your current GST turnover
- You must allocate sales to the relevant quarter in the same way you would report these sales in your BAS if you were registered for GST
- If you are not registered for GST, you will work out your turnover using either the GST cash or non-cash basis of accounting.
What you need to do
From 28 September 2020, you are required to:
- Determine your eligibility for the JobKeeper Extension scheme using the actual turnover test for the September quarter
- Determine if you have any new eligible employees that were not previously nominated for JobKeeper and ask them to agree to be nominated
- Work out the Tier 1 or Tier 2 rate of pay that you will be claiming for each eligible employee/eligible business participant
- Notify your eligible employees which payment rate is applicable for them
- Ensure your eligible employees/eligible business participants receive the correct rate of payment per fortnight during each of the JobKeeper Extension periods according to the two tiers of payment
- If you are registered for GST and have outstanding Business Activity Statements (BAS), ensure you lodge your BAS for the September 2019 and December 2019 quarters now (or for equivalent months, if you report monthly) so that you do not hold up your application for the JobKeeper Extension Scheme
The required decline in GST turnover percentages will remain the same:
- 30% for an aggregated turnover of $1 billion or less
- 50% for an aggregated turnover of more than $1 billion
- 15% for ACNC-registered charities other than universities and schools.
What you do not need to do:
If you are already enrolled for the current JobKeeper Scheme for fortnights prior to 28 September 2020, you do NOT need to:
- Re-enrol for the JobKeeper Extension Scheme
- Re-assess eligibility for employees already receiving JobKeeper for the JobKeeper Extension Scheme or ask them to agree to be nominated
- Meet any further requirements if you are claiming for an eligible business participant, other than holding an ABN and declaring assessable income and supplies
The ATO has a useful one page fact sheet outlining the key changes, but please ask us if you have a question.
Changes in JobSeeker Payment
JobSeeker will continue until the end of December 2020, and then the government will review at the end of the year to assess if it needs to be extended further. Here are the changes in payment rates:
- COVID supplement of $550 per fortnight will be reduced to $250 from October until the end of the year, making the JobSeeker rate around $800 per fortnight.
- Those on this payment can earn up to $300 per fortnight without reducing their payment
Mutual Obligations to Return in 2 Phases
You will need to do the following to avoid penalties:
Phase 1 – August 4th
- Reconnect with employment services
- Undertake 4 job searches a month
- Take jobs where offered
Phase 2 – End of September
- The number of required job searches a month will be higher
- Take jobs where offered
In both Phase 1 and Phase 2, people will be given penalties if they do not take jobs offered.
Queensland Border Zone Extensions from October 1st
Queensland’s border zone will be extended to 5 local government areas in NSW starting October 1st. These areas include: Byron, Ballina, Lismore, Richmond Valley and Glen Innes councils.
South Australia-NSW Borders to Open 24 September 2020
South Australia has reopened its borders to New South Wales on Thursday morning 24 September 2020, after NSW recorded another day with no community transmission. This means NSW residents entering SA will no longer have to undergo the mandatory 14-day quarantine.
From Thursday morning 24 September 2020 the only part of Australia barred from entering South Australia is Victoria.
Business Resilience Package for Victorian Businesses
The Victorian government is investing $3 billion in cash grants, tax relief, and cashflow support to aid businesses hit by the tight restrictions and help them prepare for COVID Normal. The types of support included in this package are divided into three categories: Business Support, Business Adaptation, and Waivers and Deferrals.
Included in Business Support is the third round of the Business Support Fund for small- and medium-sized business ($822 million), applications have been accepted from 18 September 2020.
Meanwhile, Business Adaptation involves funding, tools, and resources to help businesses adapt to COVID Normal. Tax and cashflow support amounting to $1.8 billion will be provided by the government under the Waivers and Deferrals scheme.
For a detailed rundown of the inclusions of the Business Resilience Package, click here. Let us help you assess your eligibility and gain access to government support. Get in touch with us so we can schedule a consultation.
Sole Trader Support Fund
The Victorian Government has announced the Sole Trader Support Fund for eligible non-employing businesses affected by COVID-19 restrictions. Under this scheme, sole traders will receive a grant of $3,000.
Grant applications will open in the coming days and the full list of eligibility criteria will be published soon. We will keep you updated as soon as more information is available.
Federal Government Announces $50 M Grant for Business Events Industry
The Federal Government has confirmed a $50 million grant for Australia’s business events industry, which will enable organisers of business events to apply for upfront grants that will cover up to 50% of their costs (between $10,000 and $250,000).
Aside from getting the business events industry back on their feet, this will also pave the way for businesses to connect through consumer and trade shows and conferences.
If you need expert business advice in growing your network amidst the pandemic, feel free to drop us a message.
Government-backed COVID-19 Loans Extended
The government is extending its small business COVID-19 loans scheme until June 2021. If you need help to access these loans or you want to find out if you are eligible, don’t hesitate to drop us a message.
Sleep is NOT for the Weak
Significant changes in the way we live brought by the pandemic, such as extended periods of lockdown, work from home setup, and social restrictions, have blurred the lines between life and work. Sometimes people forget even the simplest self-care habits such as getting enough rest.
Sleep is as close to a panacea as we are likely to get in our lifetimes: it helps us recover from injuries and illness, plays a vital role in memory formation, and helps keep us healthy. Disrupting our sleep has an adverse impact on nearly every system in our bodies.
The uncertainties due to the current global crisis also cause high levels of stress. In a recent study by the National Bureau of Economic Research, it was found that unemployment disrupts sleep, along with other negative impacts on health and well-being.
Even if you are not unemployed, the pandemic has been stressful enough that many people are experiencing ‘coronasomnia.’ In this article, a Harvard Business Review editor describes her experiments with four different tactics to get better sleep. The one that worked best for her was setting aside all electronics and avoiding all screens for two hours before bedtime.
These have been unusual times that are impacting nearly everyone on the planet. We hope that you are finding ways to make this a time not just for survival but for growth as well!
Government Launches Business Continuity Website to Support Businesses Amid COVID-19
The Australian Government has launched the Australian Business Continuity website to support businesses with staff working remotely amid the pandemic.
The site provides free practical tools for remote communications, collaboration, workforce management, and video conferencing, as well as advice on how to best use teleworking services.
Get in touch
Contact us if you have any questions.