The measures in this package are designed to assist Australian businesses and economic growth in the short term, and encourage a stronger economic recovery following the Corona-virus outbreak.
The government will establish the Corona-virus SME Guarantee Scheme, which will support small and medium enterprises (SME’s) to get access to working capital to help them get through the impacts of the virus. The government will guarantee 50% of new loans issued. This support will enhance lender’s willingness and ability to provide credit to those businesses eligible for the scheme who require loans to survive.
There will be temporary relief for financially distressed businesses. This includes:
- Temporarily increases to the threshold at which creditors can issue a statutory demand on a company and the time that companies have to respond to such demands
- Temporary relief for directors from any personal liability for trading whilst insolvent
- The Boosting Cashflow measure for employers will provide up to $50,000 cash back to small and medium businesses, with minimum payments being $10,000 for eligible businesses. This covers all businesses with turnover of less than $50 million who employ staff. The payment will be tax free.
- The way this will work is that for all quarterly and monthly BAS/PAYGW statements lodged from March 2020 onward you will receive a 100% reduction of your PAYG withholding obligation for that period, up to the cap. If that reduction does not take you up to the $50,000 total cash back on your March BAS, then it will apply to your June BAS period until the total is used up. There will then be another $50,000 available for payment from 28th July onward.
- Eligible employers will be able to apply for a wage subsidy of 50% of the apprentice’s or trainee’s wage for up to a 9 month period from 1 January 2020 to 30 September 2020. If a business is not able to retain an apprentice, the subsidy will be available to a new employer that employs that same apprentice.
