How the economic package can help you

On March 12, Prime Minister Scott Morrison announced a $17.6 billion ‘economic plan’ to keep the economy and businesses afloat in the face of unprecedented challenges posed by the spread of the novel coronavirus.

Big winners from the package include vulnerable members of the community as well as small businesses.

SEE ALSO: Industry welcomes economic package

On March 22, the Prime Minister injected a further $66.1 billion into the economy as businesses face months of shutdown ahead.

What do these packages mean for you and your business and how will you benefit from it? We break it down for you:

The instant asset write off threshold has been increased from $30,000 to $150,000.

Access to the tax write-off has also expanded to include businesses with annual turnover of less than $500 million, up from $50 million, until 30 June 2020.

This means businesses can immediately write-off assets of larger value such as trucks and trailers.

In addition, eligible businesses will also be able to deduct an additional 50 per cent of the asset cost in the year of purchase.

Small to medium businesses with a turnover of less than $50 million, as well as not-for-profit organisations that employ staff between 1 January 2020 and 30 June 2020 will be eligible for a minimum payment of $20,000, up to $100,000.

The payment will be tax free and issued automatically based on business activity statements or instalment activity statements from April 28. Employers will receive 100 per cent of their salary and wages withheld as an incentive to hold on to their workers.

From July 28, eligible businesses and organisations will also receive an additional payment equal to the total of all of the cash flow boost received in the previous period.

Under the scheme, the Government will guarantee 50 per cent of new loans issued by eligible lenders to small and medium businesses.

The move complements announcements made by Australian banks to support small businesses with their existing loans.

If you currently employ apprentices or trainees in your operation, this measure will be of great help.

Eligible small businesses will be able to apply for a wage subsidy of 50 per cent of the apprentice’s or trainee’s wage for up to 9 months from January 1 to September 30, 2020.

In the case a small business is not able to retain an apprentice, the subsidy will be available to a new employer that employs that apprentice.

The Morrison Government has also announced $1 billion to assist specific sectors that will be more heavily affected than others in the current climate, such as tourism, agriculture and education.

This will include funds to help farm businesses identify alternative export markets or supply chains. How the funds will be distributed is still unclear.

Recipients of the Farm Household Allowance will receive an extra $550 per fortnight, on top of the existing payments they currently receive. The cash boost is also available to recipients of JobSeeker payments, Youth Allowance, Parenting Payment and Special Benefit.

The payment, dubbed the 'Coronavirus supplement', will be paid for the next 6 months.

Members of the community that receive income support such as pensioners, social security, farm household allowance (FHA), veteran and eligible concession card holders will receive an initial payment of $750 per person to be made from March 31 on a progressive basis.

The payment is tax free, with over 90 per cent of payments expected to be made by mid-April.

Then, another $750 will be available to social security and veteran income support recipients and eligible concession card holders, except for those who are eligible for the Coronavirus supplement. This includes those receiving the FHA. The second round of $750 will be paid automatically from July 13, 2020.

We will continue to update this article with new support measures as they come through.