Happy New Financial Year! The Informer 2020 is out now!
Happy New Financial Year from everyone at Hern & Associates!
The Informer 2020 is out now and this issue is filled with lots of important updates from the ATO. This financial year the ATO will be focusing on work related expenses as many worked from home as a result of Covid-19.
Just a reminder that we have Covidsafe practices in place in the office. We are more than happy to arrange Skype, Zoom or telephone appointments as an alternative to visiting our office. We will also accept your Working Papers via email , post or drop in if an interview is not necessary.
The recent announcement regarding the JobKeeper Payment has been good news for businesses. Since the announcement we have not had clear information about how the payment will be distributed to employers so they can pass it on to their employees. Today the Treasury have released Frequently Asked Questions to give businesses more clarity regarding the payment.
To find out more about the JobKeeper Payment click here for more information
If you think your business (including sole traders) is eligible for JobKeeper click here to register your Intent to Claim
Boosting Cash Flow for Employers
The government is providing up to $100,000 to eligible small and medium sized businesses, and not-for-profit that employ people, with a minimum payment of $20,000. These payments will help businesses’ and not-for-profits’ cash flow so they can keep operating, pay their rent, electricity and other bills and retain staff.
Under the enhanced scheme, employers will receive a payment equal to 100% of their salary and wages withheld, with the maximum payment being $50,000. In addition, a minimum payment of $10,000.
An additional payment is also being introduced in the July-October period. Eligible entities will receive an additional payment equal to the total of all of the Boosting Cash Flow for Employers payments they have received. This means that eligible entities will receive at least $20,000 up to a total of $100,000 under both payments. This will provide cash flow support and help employers to retain staff and keep operating.
This cash flow boost provides a tax free payment to employers and automatically calculated by the Australian Taxation Office (ATO). There are no new forms required.
Eligibility
Small and medium sized businesses and Not For Profits that employ workers will be eligible. Eligibility will generally based on prior year turnover.
- The payment will be delivered by the ATO as an automatic credit in the activity statement system from 28 April 2020 upon employers lodging eligible upcoming activity statements.
- Eligible employers that withhold tax to the ATO on their employees’ salary and wages will receive a payment equal to 100% of the amount withheld, up to a maximum payment of $50,000.
- Eligible employers that pay salary and wages will receive a minimum payment of $10,000 even if they are not required to withhold tax, because the employees are below the tax free threshold.
- The payments will only be available to active eligible employers established prior to 12 March 2020
Eligibility – Additional payment
To qualify for the additional payment, the entity must continue to be active in the July – October 2020 quarter.
For monthly activity statement lodgers, the additional payments will be delivered as an automatic credit in the activity statement system. This will be equal to a quarter of their total initial Boosting Cash Flow for Employers payment following the lodgment of their June 2020, July 2020, August 2020 and September 2020 activity statements (up to a total of $50,000).
For quarterly activity statement lodgers the additional payments will be delivered as an automatic credit in the activity statement system. This will be equal to half of their total initial Boosting Cash Flow for Employers payment following the lodgment of their June 2020 and September 2020 activity statements (up to a total of $50,000).
Timing – Boosting Cash Flow for Employers payments
The Boosting Cash Flow for Employers payment will be applied to a limited number of activity statement lodgments. The ATO will deliver the payment as a credit to the entity upon lodgment of their activity statements. Where this places the entity in a refund position, the ATO will deliver the refund within 14 days.
| Type of lodger | Eligible period | Lodgment due date |
| Quarterly | Quarter 3 (January, February and March 2020)
Quarter 4 (April, May and June 2020) |
28 April 2020
28 July 2020 |
| Monthly | March 2020
April 2020 May 2020 June 2020 |
21 April 2020
21 May 2020 22 June 2020 21 July 2020 |
Quarterly lodgers will be eligible to receive the payment for the quarters ending March 2020 and June 2020.
Monthly lodgers will be eligible to receive the payment for the March 2020, April 2020, May 2020 and June 2020 lodgments. To provide a similar treatment to quarterly lodgers, the payment for monthly lodgers will be calculated at three times the rate (300 per cent) in the March 2020 activity statement.
The minimum payment will be applied to the entities’ first lodgment.
For more information refer to the Cash Flow Assistance Fact Sheet from Treasury.gov.au
Income Support for Individuals & Households
The Government is providing support for individuals to assist them during the next six months.
The Government is providing 2 separate payments of $750.00 to social security, veteran and other income support recipients and eligible concession card holders. The first payment will be anytime from 12 March 2020 to 13 April 2020. The second payment will be made on 10th July 2020.
For more information refer to the Payment to Support Households Fact Sheet from Treasury.gov.au
Income Support for Sole Traders and Self Employed
If a sole trader or self employed person who is impacted by the economic downturn triggered by the coronavirus they will be able to access the job seeker payment and the coronavirus supplement.
Applicants will make a declaration to Centrelink via the Job Seeker payment scheme, to declare that their business has been suspended or had a turnover reduced significantly as a result of the downturn. Sole traders that become eligible for the Jobseeker Payment will automatically meet their mutual obligation requirements during this period by continuing to develop and sustain their business.
For more information refer to the Income Support for Individuals Fact Sheet from Treasury.gov.au
Support for Retirees
Due to the impact of volatility in the financial markets, the Government is offering relief for Retirees and Self Managed Super Funds in Pension Mode
The Government is temporarily reducing superannuation minimum drawdown requirements for account-based pensions and similar products by 50 per cent for the 2019-20 and 2020-21 income years.
The Government is also reducing both the upper and lower social security deeming rates by a further 0.25 percentage points in addition to the 0.5 percentage point reduction to both rates announced on 12 March 2020.
Temporary Reduction in Superannuation Minimum Drawdown Requirements
This measure will benefit retirees with account-based pensions and similar products by reducing the need to sell investment assets to fund minimum drawdown requirements.
The reduction applies for the 2019-20 and 2020-21 income years.
| Age | Default minimum drawdown rates (%) | Reduced rates by 50 per cent for the 2019-20 and 2020-21 income years (%) |
| Under 65 | 4 | 2 |
| 65-74 | 5 | 2.5 |
| 75-79 | 6 | 3 |
| 80-84 | 7 | 3.5 |
| 85-89 | 9 | 4.5 |
| 90-94 | 11 | 5.5 |
| 95 or more | 14 | 7 |
This measure will have no impact on the underlying cash balance for 2019-20 and a negligible impact in 2020-21.
For more information refer to the Support for Retirees Fact sheet from Treasury.gov.au
Early Access to Superannuation
The Government is allowing individuals affected by the Coronavirus to access up to $10,000 of their superannuation in 2019-20 and a further $10,000 in 2020-21.
There is strict early release requirements that will be assessed by the Australian Taxation Office (ATO). We stress that this should be considered a last resort for financial assistance. Accessing your superannuation when the market is so low will be detrimental to your super balance in the future.
For more information refer to the Early Access to Super Fact Sheet from Treasury.gov.au
Our office will be closed from 5pm, Friday 20th December and reopen on Monday 20th January 2020.
We will be checking emails and voice mail sporadically during this time. For urgent issues please email maria@herns.com.au
On behalf of Brian, Maria and the Associates, we wish you and your family a very Merry Christmas and a Safe and Happy New Year!!
Happy New Financial Year from everyone at Hern & Associates!
The Informer 2019 is out now and this issue is filled with lots of important changes from the ATO and how the Single Touch Payroll affects your business.
We look forward to seeing you in the office this tax time!
Following the death of the Family Matriarch, Gwen Hern, our Mother and Grandmother, the office will be closed on Thursday 24 and Friday 25th January. Being a family firm we are all involved in the final farewell. We apologise for the inconvenience.
‘Cherished by her family, Forever in our Hearts’
For your convenience you can now pay your invoices via our website.
You can make a credit card payment 24 hours a day, 7 days a week or request a monthly payment facility*
Paying by credit card is totally secure and utilises the latest secure technology features and complies with the Payment Card Industry Data Security Standard – PCI DSS therefore you always have peace of mind when making your transactions.
Paying by our monthly payment facility * is a great cash flow tool that we offer to our business clients as a value added service. We know only too well the importance of cash flow to business and are proud to be able to offer this service.
To pay online simply go to our website and select the PAYMENTS tab. https://www.herns.com.au/associates/payments/
To help, we have also updated the Payment Options section of our invoices to point you to our Payment gateway.
Choose your preferred method of payment and complete the required fields. Once payment is made, you will receive an email verifying your transaction.
Of course we still offer the ability for you to pay your invoices like you may have done in the past such as via cheque and EFT.
Note: *monthly payment facilities are only available to businesses with an ABN and invoices over $2000
Happy New Year and welcome to the 2018 edition of The Informer.
In this issue we focus on a lot of important changes from the ATO and ASIC as well as looking at some changes announced in the 2018 Federal Budget.
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