Stimulus for Eligible Employers
The legislation and supporting documentation for the first two stages of the stimulus came to more than 200 pages. Our team has been reading the literature and attending training seminars on the application of this new legislation and working out how this legislation applies to your business.
PAYG Withholding Stimulus for eligible employers
| TAX FREE PAYMENTS of up to $50,000 for eligible* small and medium businesses based on their PAYG withholding obligations. This is not a cash payment, but it is a credit equal to 100% of the PAYG amounts withheld from salary and wages paid to employees. |
| Businesses that lodge activity statements on a quarterly basis will be eligible to receive the credit for the quarters ending March 2020 and June 2020. Business that lodge on a monthly basis will be eligible for the credit for the March 2020, April 2020, May 2020 and June 2020 lodgements. |
| If a business pays salary and wages to employees but is not required to withhold any tax, then a minimum payment of $10,000 will still be made. The minimum $10,000 payment will be applied to the first activity statement lodgement. |
| * in many cases eligibility is simple, however due to legislative quirks some businesses will not be eligible despite suffering loss and being deserving of support. |
| BAS |
| The ATO have indicated 28 April is the earliest date they will be processing March BAS with payments 14 days later, so do not panic to lodge early. We recommend having your accounts reconciled and ready for processing as soon as possible so that we can better assess your circumstances and assist you with your current position and stimulus options. |
| with your position. |
| SCHEMES – Big Brother is watching. |
| The ATO has released very strong warnings about entering into Schemes to extract more from the stimulus than you are otherwise entitled. |
| A scheme to inflate a business or personal claim may see that claim reduced to nil with additional penalties and criminal sanctions applied. ATO data matching capabilities are high and in the case of intentional dishonesty there is unlikely to be a time limit on ATO ability to review claims at a future date. |
| That said, there may be valid commercial justifications for a change in your business and financial behaviour. The world has fundamentally changed in the last 6 weeks and your commercial arrangements may change to suit (a new business, pay history needed for loan applications, preparing for single touch payroll, providing regularity and business discipline in pay yourself first, etc). |
| For the March quarter we strongly recommend you follow your usual course of business and assess your position as required from April onward. |
