Here are some key links about what the federal and ACT Governments are undertaking to assist businesses, which are current as of 29th of May 2020.
The JobKeeper wage subsidy
The government has also announced a flat payment to businesses of $1,500 for every full-time, part-time or long-term casual employee as part of their JobKeeper Payment.
Eligible employers will be paid $1,500 per fortnight per eligible employee. This money will be for the specified purpose of keeping the employee in work.
Employers with less than $1bn in annual turnover who have experienced a 30% decrease in aggregated annual turnover will be eligible. A decrease of 50% in annual turnover is required for larger businesses to be eligible.
The JobKeeper Payment will support employers to maintain their connection to their employees. These connections will enable business to reactivate their operations quickly – without having to rehire staff – when the crisis is over.
The ATO have specifically released a JobKeeper guide for Sole Traders. Sole traders who meet the business and employee eligibility should be eligible for the wage subsidies.
For sole traders and self-employed people, you may be eligible for Youth Allowance or JobSeeker Payments from 27 April. If approved, continuing to operate your business will fulfill your mutual obligations. (That is, you won’t have to apply for jobs, or establish and follow a Jobs Plan). For more information, see here.)
First and second federal stimulus packages
The stimulus packages can be viewed on the Treasury website. The second stimulus package will begin in June 2020.
Some other key measures include:
- The increased instant asset write-off
- Accelerated depreciation deductions
- Guaranteeing loans to small and medium sized business
- Additional tax support
For owners of businesses (including small and medium sized businesses, and charities or not-for-profits registered with the ACNC) with less than $50 million in aggregated annual turnover which employ people, please see the Boosting Cash Flow for Employers measure. This automatically applies two payments equal to 100 per cent of business salary and wages withheld (up to a maximum of $50,000, but not below a minimum of $10,000).
Additional measures to assist businesses
The federal government is also providing assistance to help pay the wages of apprentices or trainees.
More information can be found on government measures supporting business here.
Business tenants and the rent eviction moratorium
Aside from commercial rates relief from the ACT Government, some businesses have been encouraged to negotiate with their commercial landlords a mutually agreeable solution.
Commercial landlords will need to play their part, cost-sharing or the deferrals of losses will be shared between Government, landlords, tenants and financial institutions.
Landlords and tenants should work together to reach an agreement that allows the business to bounce-back when the time is right. The ACT Government will appoint a Commercial Tenancy Mediator (Business Commissioner) to support and encourage commercial landlords and tenants to engage and negotiate mutually agreeable outcomes.
National Cabinet has agreed on 9 principles that will guide the mandatory code of contact regarding commercial tenancies.
- Where it can, rent should continue to be paid, and where there is financial distress as a result of COVID-19 (for example, the tenant is eligible for assistance through the JobKeeper program), tenants and landlords should negotiate a mutually agreed outcome
- There will be a proportionality to rent reductions based on the decline in turnover to ensure that the burden is shared between landlords and tenants
- There will be a prohibition on termination of leases for non-payment of rent (lockouts and eviction)
- There will be a freeze on rent increases (except for turnover leases)
- There will be a prohibition on penalties for tenants who stop trading or reduce opening hours
- There will be a prohibition on landlords passing land tax to tenants (if not already legislated)
- There will be a prohibition on landlords charging interest on unpaid rent
- There will be a prohibition on landlords from making a claim to a bank guarantee or security deposit for non-payment of rent
- Ensure that any legislative barriers or administrative hurdles to lease extensions are removed (so that a tenant and landlord could agree a rent waiver in return for a lease extension)
The ACT Government are also deferring and reimbursing commercial rates.
For the full tranche of ACT Government supports for local business and the economy, please see here.