How to prepare for the impacts of COVID-19

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Coronavirus. The one word that has sent the world into a state of uncertainty.

Toilet paper, canned food, tissues, pasta, rice, soap – just to name a few of the ‘essential’ items that have become rare finds among supermarkets shelves.

But how do you prepare as a business? How do you continue to provide your services if 50% of your staff are forced into isolation? How do you keep the daily wheels turning as more and more preventative protocols are put in place? The answer, stay calm but be prepared.

Can your staff work remotely

If your business is already using off-site working practices, that’s great. If you’ve been considering the option of working remotely, now is your chance to review and implement within your business.

Have a contingency plan in place

It’s important to have a contingency plan in place in case you need to act quickly. Updates and protocols are being announced by the hour, you need to have a plan in place should you and your staff members be forced to self isolate on short notice. This includes things such as ensuring your employees can efficiently work remotely, communications are ready to be distributed to your clients and suppliers, and that you have all relevant paperwork and technology ready to take with you if you cannot return to the office.

Review your cash flow

While we’re not trying to increase the panic, it is important for you to review cash flow and expenses. The impacts of the COVID-19 will differ for every business, so if you are going to experience a slowdown in cash flow, it’s important that you review how this may affect you over the coming months.

Review any non essential purchases

We encourage you to review any non essential purchases. Leading on from managing your cash flow, it might be wise to review any purchases that are non essential. You may want to look at reducing stocks and only purchasing the vital items.

Seek assistance sooner rather than later

We urge anyone who might be unsure of how the COVID-19 outbreak will affect them and their business to seek advice as soon as possible. It is crucial that you are planned and prepared to face the impacts that may occur as a result over the coming months.

What are the stimulus package measures for businesses?

Cash flow assistance for SME’s

Businesses who lodge Business Activity Statements (BAS) or Instalment Activity Statements (IAS) for the March and June quarters may be eligible to receive cash assistance. The Government has announced a cash flow boost of up to $25,000 equal to 50% of their Pay As You Go withheld amounts. The tax free payment will be made available to businesses with a turnover of less than $50 million with employees between 1 January 2020 and 30 June 2020.

Instant asset cash write-off increased from $30,000 – $150,000 and access extended

The package has seen the instant asset write-off threshold increase from $30,000 to $150,000 and has also expanded to include access for businesses with an aggregate annual turnover of less than $500 million until 30 June 2020.

Wage subsidies available for apprentices and trainees

$1.3 billion has been allocated to support the jobs of 120,000 apprentices and trainees employed by small businesses. Eligible employees can apply for a wage subsidy of 50% of the apprentice’s or trainee’s wage for a period of up to 9 months from 1 January 2020 to 30 September 2020.

What about individuals and other industries that have been affected?

Other measures to provide assistance for individuals include household stimulus payments of $750 for pensioners and people who receive social security, veteran and any other form of income support as well as eligible concession card holders. The tax free payments will be made from 31 March 2020 on a progressive bases.

An amount of $1 billion has also been provided to help regions, sectors and communities who have been economically affected by the outbreak, including:

  • Agriculture
  • Education
  • Tourism

What is the ATO doing to provide relief?

The ATO have announced a number of measures that will be put in place to relieve the concerns of those affected. The ATO have acknowledged that the COVID-19 outbreak will have an effect on both individuals and businesses and as a result have extended their opening hours to provide extended support along with the announcement of a number of additional support provisions.

The ATO have pledged the following:

  • Up to four month deferral of the payment date of amounts due through the business activity statement including PAYG installments, income tax assessments, fringe benefits tax assessments and excise.
  • Quarterly GST reporting businesses will also have the option to opt into monthly GST reporting in order to get quicker access to GST refunds.
  • Businesses will also be allowed to vary pay-as-you-go installment amounts to zero for the April 2020 quarter. Businesses who do this will be also able to claim a refund for any installments made for the September 2019 and December 2019 quarters.

It is important to note that assistance measures will not be issued automatically and businesses and advisors are encouraged to contact the ATO or their Accountant to discuss their situation.

Our Accountants are available to provide any assistance that you may require. If you do have any questions about how the COVID-19 stimulus package may affect you and/or your business we encourage you to reach out to ensure you receive what you are entitled to.

Please take care and be aware of the precautionary measures.

If you are unsure if you are eligible to receive assistance our staff are here to help. Please contact our office on (03) 5445 4777.

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