Government Support Announcement for COVID-19 Affected Business
The Prime Minister has declared assistance to Small Businesses of Australia. While everybody is facing difficulty time during pandemic, Government has declared support package for Small Businesses.
Support to Businesses to keep people employed
Rise in Cash Flow for Employers
The Government is offering up to $100000 to the eligible small and medium businesses this also includes non-profits organizations like charities those employ people with payment of minimum $20000. Under this extensive scheme from the first package, the employers will get a payment that equals to 100% of their wages and salary, having the maximum payment increased from $25000 to $50000. Moreover, the lowest payment is enhanced from $2000 to $10000. The availability of the payment shall be from 28 April 2020.
Regulatory protection and financial support for businesses to stay in business
SME Guarantee Scheme during Coronavirus
The Government will set up the SME Guarantee Scheme during Coronavirus which will support small and medium enterprises (SMEs) to get access to working capital to help them get them through the impact of the coronavirus. Under this Scheme, the authorities will guarantee 50 per cent of new loans issued by eligible lenders to SMEs.
The Scheme will complement the declarations that the Government has made to allow SMEs to get access to credit efficiently. It also includes declarations made by the Australian banks to support small businesses with their existing loans.
Provision of temporary relief for businesses financially distressed
The Government is enhancing the threshold at which the creditors can issue a statutory demand on a company and the time companies have to respond to statutory demands they receive. The package also involves of a temporary relief for directors from any personal liability for trading while insolvent. The Corporations Act 2001 will be amended to provide temporary and targeted relief for companies to deal with unforeseen events that arise as a result of the Coronavirus.
Other Support Provided by the Government
The Government is temporarily expanding eligibility to income support payments and establishing a new, time-limited Coronavirus supplement to be paid at a rate of $550 per fortnight. This will be paid to both new and existing recipients of the JobKeeper Payment, Farm Household Allowance, Youth Allowance JobKeeper, Parenting Payment and Special Benefit.
This supplement will be paid for the coming 6 months. The income support recipients who are eligible, will receive amount of the $550 Coronavirus supplement each fortnight.
An increment of up to 5,000 staff for Services Australia will provide you assistance to support delivery of new measures taken by Government.
Payments to support households
In addition to the stimulus payment of $750 declared on 12 March 2020, the authorities will offer $750 payment to social security and veteran income support recipients and eligible concession card holders, those who are receiving an income support payment that is eligible to receive the Coronavirus supplement will not be included in this payment.
This second payment will be made automatically from 13 July 2020 to around 5 million social security, veteran and other income support recipients and eligible concession card holders. Around half of those that benefit are pensioners.
The first payment will be made from 31 March 2020 to people who will have been on one of the eligible payments any time between 12 March 2020 and 13 April 2020.
Release of superannuation early
The Government will allow individuals in financial stress as a result of the Coronavirus to access up to $10,000 of their superannuation in 2019-20 and a further $10,000 in 2020-21.
Eligible individuals will be able to apply online through myGov for access of up to $10,000 of their superannuation before 1 July 2020. They will also be able to access up to a further $10,000 from 1 July 2020 for another three months. They will not need to pay tax on amounts released and the money they withdraw will not affect Centrelink or Veterans’ Affairs payments.
Reduction in superannuation minimum drawdown rates temporarily
The Government is temporarily reducing superannuation minimum drawdown requirements for account based pensions and similar products by 50 per cent for 2019-20 and 2020-21. This measure will benefit retirees by providing them with more flexibility as to how they manage their superannuation assets.
Decreasing social security deeming rates
On top of the deeming rate changes made at the time of the first package, the Government is reducing the deeming rates by a further 0.25 percentage points to reflect the latest rate reductions by the RBA. As of 1 May 2020, the lower deeming rate will be 0.25 per cent and the upper deeming rate will be 2.25 per cent.
Read more about the detailed information by the Australian Government with regards to cash flow assistance for small businesses.
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