Newsletter - Special Edition: COV-19
Cents & Sensibility | Tax News | Views | Clues
Special Edition: COV-19
knp Solutions has prepared a special edition newsletter outlining:
- Australian Government’s economic response to COV-19 & how this could relate to your business
- knp client meetings
- COV-19 symptoms & information for workplaces
Due to the limited time in which the package applies, we urge all our clients to immediately consider whether they believe they qualify for these measures and the impact that each of the measures may have on their business and cash flow. Please contact our office if you need more information.
Economic response to COV-19
The Australian Government has announced an economic response totalling $17.6 billion to counter any economic downfall that may be caused by COVID-19 (coronavirus).
The measures have the potential to provide significant cash flow to businesses in the short term and this is being funded predominantly through the tax system.
The Government will move quickly to implement this package. To that end, a package of Bills will be introduced into Parliament in the final Autumn sitting week in March 2020 for Parliament’s urgent consideration and passage. Following passage of the Bills through Parliament, the Government will then move to immediately make, and register, any supporting instruments.
Summary of the Economic Response
- Delivering support for business investment
- Cash flow assistance for businesses
- Stimulus payments to households to support growth
- Assistance for severely affected regions
Below is more detail on each of the measures.
1.Delivering support for business investmentThere are two business investment measures in this package and these are designed to assist Australian businesses and economic growth in the short term with the aim being to encourage a stronger economic recovery following the Coronavirus outbreak.
a). Increasing the instant asset write-off From the 12th March 2020, the Australian Government is increasing the instant asset write-off threshold from $30,000 to $150,000 and expanding access to includes businesses with aggregated turnover of less than $500 million until 30 June 2020. Almost all of our business clients will qualify for this concession.
b). Backing business investment The Government is introducing a time limited 15-month investment incentive (through to 30 June 2021) to support business investment and economic growth over the short term. This is effectively an accelerated depreciation allowance on eligible assets. This measure allows businesses with turnover of less than $500 million to immediately deduct 50 per cent of the cost of an eligible asset. Existing depreciation rules would continue to apply to the balance of the asset’s cost. The announcement doesn’t specify whether turnover would constitute aggregated turnover.
2.Cash flow assistance for businesses This assistance will support business to help manage cash flow challenges that are arising from the economic impacts of COVID-19 and assist businesses to retain their employees. These measures are specifically aimed at supporting small and medium enterprises (the vast majority of clients at knp Solutions) and to improve business confidence.
a). Boosting cash flow for employers This measure will provide up to $25,000 back to small and medium-sized businesses, with a minimum payment of $2,000 for eligible businesses. The payment will provide cash flow support to those business who employee staff and have a turnover of less than $50 million. The receipt of this amount will be tax-free to the employer. The amount of the payment is to be 50 per cent of the PAYG withheld from salary and wages as reported on the employer’s BAS or IAS over the 6-month period from 01 January 2020 to 30 June 2020. There is the potential for small employers who withhold minor amount or none at all to still potentially receive the minimum $2,000 payment.
b). Supporting apprentices and trainees The government is supporting small business to retain their apprentices and trainees. Eligible employers can apply for a wage subsidy of 50 per cent of the apprentice’s or trainee’s wages for up to months from 01 January 2020 to 30 September 2020. Where a small business is not able to retain an apprentice, the subsidy will be made available to a new employer that employs that apprentice. Eligible businesses with less than 20 full-time employees will be able to register for the subsidy from April 2, 2020.
3.Stimulus payments to households to support growth
The Government will provide a one-off $750 payment to social security, veteran and other income support recipients and eligible concession card holders. Around half of those that will benefit are pensioners. This will be tax free and will not count as income for Social Security, Farm Household Allowance and Veteran payments.
4.Assistance for severely affected regions
This measure provides $1 billion to support regions most significantly affected by the Coronavirus outbreak.
a). Support for Coronavirus-affected regions and communities The Government has set aside $1 billion to support those regions and communities that have been excessively affected by the economic impacts of the Coronavirus, including those that are heavily reliant on industries such as tourism, agriculture and education. This will include the waiver of fees and charges for tourism businesses that operate in the Great Barrier Reef Marine Park and the waiver of entry fees for Commonwealth National Parks. It will also include additional assistance to help businesses identify alternative export markets or supply chains, with targeted measures to further promote domestic tourism. The Australian Tax Office (ATO) is also providing administrative relief for some tax obligations for people affected by the Coronavirus outbreak, on a case-by-case basis.
On 12 March 2020, the ATO announced a series of administrative concessions to assist business impacted by COVID-19 which include:
- Deferring by up to four months the payment date of amounts due through the business activity statement (including PAYG instalments), income tax assessments, fringe benefits tax assessments and excise
- Allow businesses on a quarterly reporting cycle to opt into monthly GST reporting in order to get quicker access to GST refunds they may be entitled to
- Allowing businesses to vary Pay As You Go (PAYG) instalment amounts to zero for the March 2020 quarter. Businesses that vary their PAYG instalment to zero can also claim a refund for any instalments made for the September 2019 and December 2019 quarters
- Remitting any interest and penalties, incurred on or after 23 January 2020, that have been applied to tax liabilities
- Working with affected businesses to help them pay their existing and ongoing tax liabilities by allowing them to enter low interest payment plans.
Employers will still need to meet their ongoing super guarantee obligations for their employees.
Unlike the bushfire relief measures, which applied automatically to particular geographic areas, assistance measure for those impacted by COVID-19 will not be automatically implemented. Anyone impacted by COVID-19 is advised to contact our office to discuss their situations.
For further information on any of the above, please follow these links:
- Economic Response to the Coronavirus - https://treasury.gov.au/coronavirus
- Delivering support for business investment - https://treasury.gov.au/sites/default/files/2020-03/Fact_sheet-Support_for_business_investment.pdf
- Cash flow assistance for businesses - https://treasury.gov.au/sites/default/files/2020-03/Fact_sheet-Assistance_for_businesses.pdf
- Stimulus payments to households to support growth - https://treasury.gov.au/sites/default/files/2020-03/fact_sheet_3_individuals_-_revised_for_clearance.pdf
- Assistance for severely affected regions - https://treasury.gov.au/sites/default/files/2020-03/Fact_sheet-Assistance_for_regions.pdf
- Support measures to assist those affected by COVID-19 - https://www.ato.gov.au/Media-centre/Media-releases/Support-measures-to-assist-those-affected-by-COVID-19/
- Supporting Apprentices and Trainees - https://www.australianapprenticeships.gov.au/node/3939
knp client meetings
Due to the declaration of an unprecedented state of emergency in Victoria, knp Solutions is taking precautionary action to ensure the health and wellbeing of both clients and staff.
We are limiting the number of in person meetings with clients in order to minimize the potential impact of Coronavirus (COVID-19).
Any non-essential face-to-face meetings will not be taking place and are postponed indefinitely.
If a client meeting is essential, knp has the infrastructure in place to facilitate a virtual meeting, if required.
It is a time of uncertainty however knp has put in place various arrangements with staff in order to maintain our high level of service.
If you have a meeting scheduled at knp, we will be in contact shortly to discuss alternative arrangements.
Exposure to coronavirus in workplaces
An outbreak of respiratory illness has been caused by a new coronavirus first identified in Wuhan, Hubei Province, China. To date, most people infected are residents of China or people who have recently travelled to China. However new cases, including deaths, are increasingly being reported outside of mainland China.
The World Health Organization has announced that COVID-19 is a pandemic. While the number of confirmed cases and deaths in Australia resulting from COVID-19 remain relatively low compared to many countries across the world, the numbers have been increasing.
For more latest announcements about COVID-19 and up-to-date advice for the situation, please visit the website .
For more daily reports of reported COVID-19 cases, please go to .
How is coronavirus spread?
COVID-19 spreads through close contact with an infected person; mostly face-to-face or within a household. It cannot jump across a room or be carried for long distances in the air so we should all go about our lives as normal.
Close contact means greater than 15 minutes face-to-face or the sharing of a closed space for more than two hours with a confirmed case.
What are the symptoms of coronavirus?
Many people who contract COVID–19 will suffer only mild symptoms. However early indications are that the elderly and people with pre-existing medical conditions are more at risk of experiencing severe symptoms.
The most common coronavirus symptoms reported include:
- Breathing difficulties such as breathlessness
- Sore throat
- Fatigue or tiredness.
Simple precautions and planning can make a big difference. Action now will help protect you, your workers and your business.
Identifying risks to health at workplaces
Employers must identify whether there is a risk to health of employees from exposure to coronavirus at their workplace.
Identifying the level of risk can include:
- Monitoring expert advice as the coronavirus situation develops, for example:
- from the Department of Health and Human Services https://www.dhhs.vic.gov.au/coronavirus
- Call the Coronavirus Health Information Line 1800 020 080. The line operates 24 hours a day, seven days a week
- Reviewing infection control policies, procedures and practices, to ensure they are effective and are being followed; https://www.health.gov.au/news/health-alerts/novel-coronavirus-2019-ncov-health-alert
- Educating and keeping employees up to date on new information
- Monitoring the latest travel advice on the Smart Traveller from the following link for anyone planning to travel overseas for work https://www.smartraveller.gov.au/ & https://www.smartraveller.gov.au/crisis/covid-19-and-travel
- Considering whether work activities put other people at risk
- Talking to employees who have:
- Travelled or are planning to travel overseas for work
- Been in contact with confirmed cases of novel coronavirus
Controlling risks to health at workplaces
Where a risk to health is identified at a workplace, employers must, so far as is reasonably practicable, eliminate the risks, or minimise the risks.
The type of control measure required depends on the level of risk as well as the availability and suitability of controls for each workplace, and may include:
Providing adequate facilities or products (alcohol-based hand sanitiser, tissues and cleaning supplies) to allow employees to maintain good hygiene practice
Developing an infection control policy, for example:
- Encourage workers who are sick with respiratory illness to stay home until they are recovered
- If someone becomes ill with respiratory symptoms at work, isolate them by placing them in a room or an area away from others
- Arrange for the person to be sent home and advise them to seek medical advice. If they are very unwell, call an ambulance
- If a worker is confirmed to have COVID-19, call 13HEALTH (13 43 25 84) for advice. Inform co-workers about possible exposure to COVID-19 but maintain confidentiality. Advise workers to seek immediate medical advice if they develop symptoms or are concerned about their health
Advising any employees to self-isolate at home for 14 days if:
in the last 14 days they have been in any of the countries listed by the Department of Health and Human Services as requiring self-quarantine.
If an employee thinks they may be at risk of infection of coronavirus:
- You should raise this with your manager immediately
- The employer may ask the employee to seek medical clearance, or work from home during the risk period
- If employees are not fit for work due to contracting coronavirus, they should follow the medical advice to remain isolated for 14 days
Employers should advise any employees who think that they might have novel coronavirus infection and have been overseas in the past 14 days, prior to the onset of their symptoms, to call ahead to their general practitioner before attending and inform them of their symptoms, travel history and concerns.
Everyone in the workplace should practice good hygiene by:
- Regularly cleaning their hands with soap and water (minimum 20 seconds) or an alcohol-based hand rub. If hands are visibly dirty wash them with soap and water
- Always washing hands with soap and water before eating and after visiting the toilet
- Covering their nose and mouth when coughing and sneezing, and disposing of used tissues immediately
- Avoiding close contact with anyone with cold or flu-like symptoms
- Seeing a health care professional if they are unwell, and staying away from the workplace and other public places
Coronavirus assessment centres
Assessment centres have been established at 12 Melbourne hospitals. You don’t need to call ahead if you attend one of the following clinics:
- The Alfred Hospital
- Albury Wodonga
- Austin Hospital
- Barwon Health – Geelong
- Box Hill Hospital
- Monash Clayton
- Northern Hospital.
- Peninsula Health – Frankston
- The Royal Melbourne Hospital
- St Vincent's Hospital Melbourne
- Sunshine Hospital
- Wonthaggi Hospital
- Ballarat Base Hospital.
Clients should not act solely on the basis of the material contained in Cents & Sensibility. Items herein are general comments only and do not constitute or convey advice per se. Also changes in legislation may occur quickly. We therefore recommend that our formal advice be sought before acting in any of the areas. Cents & Sensibility is issued as a helpful guide to clients and for their private information. Therefore it should be regarded as confidential and not be made available to any person without our prior approval. Please contact us if you wish to discuss how the points raised in this edition specifically affect you.
The knp Team