Category: Tax

COVID-19 Extensions

As the impact of the coronavirus on our daily lives and livelihoods rapidly evolves, below are the latest measures released by the Government to reduce both the impact to the nations health, economy, household and business finances.

At times like these it’s important to have someone to talk to, so we urge you to contact us if you have concerns about your finances.

To further support Australian businesses through the fallout resulting from COVID-19, the government has extended the $150,000 instant asset write-off for an additional six months to 31 December 2020.

Initially announced on 12 May and intended to last until 30 June, the government’s $17.6bn stimulus package in part temporarily increased the threshold of the instant asset write off up from $30,000.

Businesses with turnover less than $500 million can continue writing off newly purchased, multiple assets, provided that each item is worth up to $150,000. Assets need to be first used or installed ready for use by 31 December.

The government anticipates that over 3.5 million businesses will be eligible to benefit from the extension of the scheme.

It is devised to encourage business owners to follow through with the investment they already had planned before the COVID-19 crisis, and assist others to invest sooner than intended to support economic growth over the near term. The measure is also intended to help to improve cash flow for businesses by bringing forward cash deductions.

The Government is extending the Coronavirus Supplement to eligible recipients to 31 December 2020. The amount of the Supplement will be adjusted to reflect the gradually improved economic conditions and improving labour market.

Both existing and new recipients eligible for the Coronavirus supplement will continue to be $550 per fortnight up to and including 24 September 2020. From 25 September, the $550 per fortnight coronavirus supplement, which effectively doubled the fortnightly income support payment, will be reduced to $250 per fortnight.

New eligibility testing

From 25 September 2020, new eligibility testing and access to payments for new and existing JobSeeker and other income support recipients will also be introduced. These include;

• Income free threshold increase: from 25 September 2020 until 31 December 2020, the income free threshold for the JobSeeker Payment recipients will increase from $106 per fortnight to $300 per fortnight. The threshold for other income support payment recipients will increase to $300 from $143 per fortnight.This means recipients can earn up to $300 per fortnight and continue to receive the maximum payment rate for the JobSeeker Payment and other income supper payments. If recipients earn over that threshold, they will still see their JobSeeker allowance tapered down.
• Means testing: the government will also re-introduce an asset test for eligibility for all payments and the Liquid Assets Waiting Period (LAWP) for all payments will be reinstated.
• Partner income testing: the partner income test cut-out will increase to $3,086.11 per fortnight, or $80,238.89 per annum, for individuals with no personal income, from 25 September 2020. The partner income test taper rate will increase to 27 cents on 25 September 2020 until 31 December 2020.
• Reinstated job-seeking requirement: from 9 June 2020, the mutual obligation requirements were reintroduced including;
  • voluntary job searches;
  • at least one phone or online appointment with a jobseeker’s employment services provider;
  • voluntary participation in activities, either online or in person; and
  • no payment suspensions or penalties for failure to comply.

Please don’t hesitate to give us a call if you have any questions about how the changes to the JobSeeker Payment will impact your financial situation.

Information in this article has been sourced from the Treasury website: https://treasury.gov.au/sites/default/files/2020-07/Fact_sheet-Income_Support_for_Individuals.pdf