A guide to surviving COVID-19 for SMEs
List of Available Benefits and Useful Resources
- Income support supplements increased, access extended and eased – for 6 months from 27 April 2020:
- A temporary coronavirus supplement of $550 will be paid to existing income support recipients (people will receive their normal payment plus $550 each fortnight for 6 months).
- Eligibility for access to income support eased to include sole traders and the self-employed, and to those caring for someone infected or in isolation.
- Waiting periods and assets tests temporarily waived.
- The payment will be made to those receiving:
- Jobseeker payment (and those transitioning to the jobseeker payment)
- Youth allowance jobseeker
- Parenting payment
- Farm household allowance
- Special benefits recipients
In addition, eligibility to income support payments will be expanded to:
- Permanent employees who are stood down or lose their job
- Casual workers
- Sole traders
- The self-employed
- Contract workers who meet the income test
- The Government notes that these criteria could include those required to care for someone affected by the Coronavirus.
- Asset testing has also been reduced and will be waived for 6 months. Income testing will still apply.
- The payment is not available if you have access to any employer entitlements such as annual or sick leave or income protection insurance.
- Two $750 payments to households
The Government is now providing two separate $750 payments to social security, veteran and other income support recipients and eligible concession card holders residing in Australia (see the full list here). The payment will be exempt from taxation and will not count as income for the purposes of Social Security, Farm Household Allowance and Veteran payments.
- Payment 1 from 31 March 2020 (previously announced on 12 March): Available to people who are eligible payment recipients and concession card holders at any time between 12 March 2020 to 13 April 2020;
- Payment 2 from 13 July 2020: Available to people who are eligible payment recipients and concession card holders on 10 July 2020.
The payments will be made automatically to those that meet the criteria.
- Banks will defer loan and credit card repayments
(See Helpful Information below)
The type of assistance offered will depend on individual circumstances, but can include:
- A deferral of scheduled loan repayments
- Waiving fees and charges
- Interest fee periods or no interest rate increases
- Debt consolidation to help make repayments more manageable.
- Early release of superannuation
From mid-April, individuals in financial distress will be able to access up to $10,000 of their superannuation in 2019-20, and a further $10,000 in 2020-21. The withdrawals will be tax free and will not affect Centrelink or Veterans’ Affairs payments.
To be eligible to access your superannuation you need to meet the following requirements:
- you are unemployed; or
- you are eligible to receive a job seeker payment, youth allowance for jobseekers, parenting payment (which includes the single and partnered payments), special benefit or farm household allowance; or
- on or after 1 January 2020:
- you were made redundant; or
- your working hours were reduced by 20% or more; or
- if you are a sole trader – your business was suspended or there was a reduction in your turnover of 20% or more.
- Temporary reduction in minimum superannuation draw down rates – superannuation minimum drawdown requirements for account based pensions and similar products reduced by 50% in 2019-20 and 2020-21.
- Deeming rates reduced – from 1 May, superannuation deeming rates reduced further to a lower rate of 0.25% and upper rate of 2.25%.
Tax-free payments up to $100,000 for employers
- From: 28 April 2020
- Eligibility: Small and medium business entity employers and not-for-profit entities, with an aggregated annual turnover under $50 million.
Eligible businesses with a turnover of less than $50 million will initially be able to access tax-free cash flow support, with the minimum amount being increased to $10,000 and the maximum amount increased to $50,000 (previously $2,000 to $25,000). However, additional support will be provided in the July – October 2020 period so that eligible entities will receive total minimum support of $20,000 and up to $100,000.
In order for a business to qualify for this support must have been established prior to 12 March 2020. The rules are more flexible for charities because the Government recognises that new charities might be established in response to the pandemic.
The cash flow support measures will be provided in the form of a credit in the activity statement system. The support will be provided in two phases.
- The first phase ensures that eligible employers receive a credit equal to 100% of the PAYG amounts withheld from salary and wages paid to employees during the relevant period, up to the maximum amount of $50,000.
- The second phase ensures that eligible employers receive another series of credits, equal to the credits that were received under the first phase. For example, if a business received $40,000 of credits in the first phase it will receive a further $40,000 of credits in the second phase. These additional credits will be spread over two or four activity statement periods, depending on whether the employer lodges on a quarterly or monthly basis.
If a business pays salary and wages to employees but is not required to withhold any tax then a minimum payment of $10,000 will be made in the first phase and a further payment of $10,000 will be made in the second phase.
The credits are automatically calculated by the ATO and employers will need to lodge an activity statement to trigger the entitlement. If the credit puts the business in a refund position the excess amount will be refunded by the ATO within 14 days.
Businesses that lodge activity statements on a quarterly basis will be eligible to receive credits in the first phase for the quarters ending March 2020 and June 2020. Credits in the second phase will be available for the quarters ending June 2020 and September 2020. The minimum $10,000 payment will be applied to the first lodgement.
Businesses that lodge on a monthly basis will be eligible for the credits in the first phase for the March 2020, April 2020, May 2020 and June 2020 lodgements. Credits in the second phase will be available for the June 2020, July 2020, August 2020 and September lodgements. The minimum $10,000 payment will be applied to the first lodgement.
Managing Mortgage Repayments:
If you’re concerned about your loan repayments, lenders are being very flexible. Major lenders have posted information at the following links. For any other lenders, please visit your lender website or contact us.
- CommBank: https://www.commbank.com.au/latest/coronavirus.html
- ANZ: https://www.anz.com.au/personal/home-loans/your-loan/covid-19/
- NAB: https://www.nab.com.au/personal/customer-support/covid19-help/home-owners-support
- Westpac: https://www.westpac.com.au/help/disaster-relief/coronavirus/
- St George: https://www.stgeorge.com.au/about/sustainability-and-community/disaster-relief/covid-19
- Macquarie: https://www.macquarie.com/au/personal/forms/financial-hardship
- ING Direct: https://www.ing.com.au/help-and-support/tips-hints-guides/financial-hardship.html
- Suncorp: https://www.suncorp.com.au/banking/help-support/financial-difficulty.html
- AMP: https://www.amp.com.au/home-loans/financial-hardship
Lifeline is available 24/7 on 13 11 44 should you require mental support.
Supporting Individuals and House-holds Fact Sheet
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