With the reintroduction of Stage 3 Covid-19 restrictions for Melbourne and the Mitchell Shire, the Victorian Government has today announced a new Business Support Package.
Of particular note is that the Government will provide a new $5,000 grant to eligible businesses. The Government has yet to provide any detail as to what is the eligibility criteria for the grants and the mechanism for claiming the grant. We will provide you with more information as it becomes available.
In addition, payroll tax payment deferrals will be available to all businesses with payrolls up to $10 million for the first half of the 2020/2021 financial year.
Please refer to the attached Media Release summarising the Package:
We here at Price Gibson are continuing to provide all of our services. We are available to assist you via phone, email or video conferencing.
We encourage all of our clients to attend to their 2020 taxation return preparation as soon as possible as planning for future taxation liabilities or accelerating tax refunds will be particularly important this year.
As always, should you require any assistance or wish to discuss your affairs in detail, please do not hesitate to contact us.
For those of you using MYOB AccountRight software products, MYOB have this week updated their system to facilitate easier payroll reporting of JobKeeper payments made on a per eligible employee basis to the ATO.
The JobKeeper payment enrolment process has been operating for a week and we thought it important to highlight the following:
You only have to qualify once. Once you start receiving the JobKeeper payment you will receive it until the end of September. You will receive it even if your income never drops by 30% again in any subsequent month or quarter.
The ATO has extended the enrolment deadline to receive April JobKeeper payments from 30 April 2020 to 31 May 2020.
Apparently some 400,000 businesses have enrolled for the April JobKeeper payment so far. The ATO acknowledges that businesses are finding it difficult to understand the JobKeeper Payment program and the enrolment process.
The Treasurer Josh Frydenberg announced on Friday afternoon several changes to the operation of the JobKeeper payment rules that may be applicable to you.
Of particular interest are proposed changes to how service/special purpose entities calculate a reduction in turnover, and confirmation of the “One in, All in” principle. Once you enter the JobKeeper payment program it is to apply to all of your employees unless they are specifically disqualified (e.g. casual employee with less than 12 months tenure; under age; not an employee as at 1 March 2020; etc)
We refer you to the ATO’s website and recommend that you visit it regularly as there are regular updates and to the Treasurers announcement.
Please do not hesitate to contact our office should you require any assistance.
The Australian Taxation Office (ATO) has been tasked with the role of administering the JobKeeper Payment program.
They have released some detail as to the process required to Register for JobKeeper Payment and claim your entitlements.
Given that their systems are not yet fully ready there is a slightly different process for the month of April compared to what will be in place for May and following months.
This program runs initially for six months from 30 March 2020 – the ATO will pay you $1,500 per eligible person per fortnight provided you pass on at least that amount per eligible person paid monthly in ARREARS. You can apply for the JobKeeper Payment program from any time that you qualify (usually when you are able to demonstrate that you have or will have a reduction in turnover of 30% as measured on a month to month or quarter to quarter comparison with last year – other measures apply to businesses with unusual circumstances). If you don’t qualify now – do not discount the program as you may qualify in future periods. Please contact us for details of the criteria as they apply to you – they are potentially complex.
Attached is a copy of the ATO published information as at 14 April 2020 from the ATO website – we recommend that you read and review this information carefully.Jobkeeper instructions
Please remember that the JobKeeper Payment applies to not only traditional employers and sole traders but to other businesses in the form of a company, trust or partnership who can also qualify for JobKeeper payments where a business owner (a shareholder, adult beneficiary or partner) is actively engaged in the business, or a director is actively engaged in the business. This is limited to one entitlement for each entity even if there are multiple business owners or participants. The ATO will provide more information soon about the eligibility of these businesses for the JobKeeper payment.
Please note that you have to satisfy the definition of operating a “business” - most “investment” entities (e.g. share investors; landlords) do not qualify as a “business” according to the ATO. Where applicable you need to explore the JobSeeker Payment program.
The process for employers and sole traders etc who qualify for the JobKeeper Payment for this month is:
Step 1. Register your interest and subscribe for the update service (most clients have already completed this step)
Step 2. Check you and your employees meet the eligibility requirements (contact us for assistance in this review)
Step 3. Continue to pay at least $1,500 to each eligible employee per JobKeeper fortnight . During April there are two JobKeeper fortnights – 30 March to 12 April and 13 April to 26 April and you have until the end of April to ensure all eligible employees are paid the correct minimum.
Step 4. Notify your eligible employees that you intend to claim the JobKeeper payment on their behalf and check that they are not already claiming JobKeeper or JobSeeker with another employer or via Centrelink.
Step 5. Arrange for your eligible employees to complete the “JobKeeper employee nomination notice” and return it to you before the end of April.
Step 6. From the 20 April you can enrol with the ATO via the ATO Business Portal or via our office. Enrolment must be completed by the end of April to qualify for the April payments.
Step 7. Provide bank details etc on the online form.
Step 8. Provide an estimate of the number of eligible employees for the first JobKeeper fortnight (30 March – 12 April) and the second JobKeeper fortnight (13 April – 26 April).
The actual online forms and access points are not yet available so you need to prepare your relevant business information in anticipation of the access being available from 20 April 2020.
The registration and claims process for May and following will be slightly different with the process being streamlined using your Single Touch Payroll (STP) pay reports – more detail will become apparent as the systems are released by the ATO.
As always, we are here to help you through this process – please so not hesitate to contact us if you need assistance.
Price Gibson Covid-19 Support Summary
It has been a difficult and testing time for all Australians.
There has been an array of information and legislative changes and assistance that can be confusing at the best of times. We have attempted to put these measures in one package for you, in the attached schedule.
If you have 20 employees or more on 1 April 2018, you will be required to report via STP from 1 July 2018.
Do you pay wages?
If you are an employer, you will be impacted by the new Single Touch Payroll (STP) reporting measures being implemented by the Australian Taxation Office.
STP means employers will be obliged to report wages, PAYG withholding and superannuation to the Australian Taxation Office directly from their payroll solution at the same time they pay their employees.
When will I need to report via STP?
STP starts from 1 July 2018 for employers with 20 or more staff (i.e. substantial employers’).If you have 19 or less employees, STP is optional until 1 July 2019 (at which time it becomes compulsory).
Who is included as an employee?
Employers need to do a headcount on 1 April 2018 to ascertain if they are caught by the new measures for reporting commencing 1 July 2018.It is irrelevant if an employee is casual or part-time – they count as 1 employee.If employee numbers drop below 20 after you have registered for STP, you need to continue reporting through STP.
The following employees are included for these purposes:
Casual employees who are on your payroll on 1 April and worked any time during March;
Employees based overseas;
Any employee who is absent or on leave (paid or unpaid);
The following employees are excluded:
Any employees who ceased work before 1 April;
Casual employees who did not work in March;
Staff provided by a third-party labour hire organisation;
*although directors are excluded from the headcount, if the employer is a ‘substantial employer’ then remuneration paid to directors through payroll, will be reportable under STP.
If you have 20 employees or more on 1 April 2018, you will be required to report via STP from 1 July 2018.
What does this mean for me?
STP means every time you pay an employee, you must report the following information electronically on, or before the day you withhold from a payment (the pay day):
payment information, including salary or wages, allowances, deductions, etc.
superannuation liability information or ordinary times earnings (OTE)
Further, you will not be required to prepare annual PAYG Payment Summaries at year end.
If you are caught by the STP regime and you maintain a manual payroll system, you will need to choose a payroll solution that is STP-enabled.We urge you to contact our office to discuss your options.
We have been advised that MYOB, Xero and Quickbooks are all working on a solution to become STP compliant and they should have more information available in the coming months.
If you are a MYOB or Quickbooks user only their cloud-based products will be STP compliant.We therefore recommend that if you are using a desktop version of the software, that you contact our office.We can assist you with the transition to a cloud-based version.
If you outsource your payroll functions (e.g. ADP), your payroll administrator should be STP compliant however we recommend you confirm this with them directly.
STP is not optional. By 1 July 2019 all employers will need to be ready to report electronically.
Please do not hesitate to contact our office should you wish to discuss any of the above in further detail. Alternatively, you can click on the following link to view a short video published by the ATO in respect to STP www.ato.gov.au/business/Single-Touch-Payroll
ATO starts random audits of taxpayers claiming work-related deductions
The ATO have started undertaking random audits of taxpayers with work related deductions. Please contact our office if you are unsure of what you can claim.
Please contact our office should you wish to discuss how these budgetary measures affect you.
Interest Rate Update
The Reserve Bank of Australia has decreased the cash rate by 25 basis points to 1.75%.
The reduction is a reaction to new data showing that inflation has dropped below their target range of 2.5 - 3%. The strength of the Australian Dollar and the impact this is having on exporters and tourism, together with a slowing housing market are also contributing factors to the rate reduction.
There is speculation that some lenders may not pass the decrease on in full. Therefore it may be a great time to review your current finance arrangements. Please contact our office should you require assistance in this regard.
Potential changes to negative gearing
The Labor Government has proposed a plan to scrap negative gearing for established properties with effect from July 2017.
The Reserve Bank of Australia has again decided to leave the official cash rate unchanged at 2%. Refer below for a copy of the official media release.
Even though the cash rate remains unchanged, lenders are making changes to lending rates so it may be useful to re-visit your current debt arrangements. Please get in touch with us if you require assistance in this regard.