An Australian Business's Guide to the Coronavirus Stimulus Package
With thousands of deaths all around the world and billions of lives being affected, the Coronavirus pandemic is a global problem that has tested nearly every human being.
As its worldwide impact continues to grow even larger each day, the virus has also put economies in every country under the state of decline with a looming threat of eventual crashing. For Australia, in particular, the speculations of an economic downturn are even greater as experts project the virus’ effects on small, medium, and large businesses to linger for another year or two.
Fortunately, the government has taken the economic effects of the COVID-19 crisis into its own hands by rolling out a Coronavirus stimulus package as a way for businesses to stay afloat during the pandemic.
A quick rundown of the government’s COVID-19 stimulus package
Based on the specifications of the package, it is geared towards providing a number of economic stimulus measures to help small and medium-sized businesses throughout the coming years. If you’re a small or medium business, know that the Australian Government’s efforts are set to help your operations maintain stability amidst economic downturn with a $17.6 billion dollar solution. The original intention of the package itself is to provide each company with enough funding to maintain continuity in terms of employment and business.
Aside from the main concepts mentioned, there are a few other ways that the stimulus package can be used to support your own business in these trying times:
To support for business activities
To ease in managing short-term cash flow challenges in the businesses
To attain targeted support for every individual in the business in spite of cash flow disruptions
The components of every stimulus package To better understand which purposes your Coronavirus stimulus package can be used for, let’s go over a few important components in greater detail: An additional 50 per cent of depreciation on assets above $150,000 One of the components to watch out for is the time-limited 15-month investment incentive that spans until June 30, 2021. By using managed depreciation rates and accelerated deductions, businesses can pursue more investments and achieve both local and national economic growth in the short term. Additionally, it is also worth noting that businesses with a turnover of less than $500 million will be able to enjoy a 50 per cent deduction of an eligible asset on installation care of the component.
Increases in instant asset write-offs In response to the current situation brought about by the coronavirus, the Government has also increased the instant asset write-off threshold by five-fold to $150,000 for businesses with a sub-$500 million turnover. This particular increase applies to assets that were purchased after March 12, 2020, and will be installed and ready for use by June 30, 2020.
Boosted cash flow for employers As one of the pivotal components included in the package, the Boosting Cash Flow for Employers measures aims to provide cash flow support for ailing businesses. With a payment that ranges from $2,000 to $25,000 for eligible businesses, the measure is intended for them that employ staff and have a turnover of less than $50 million.
Through the use of the Coronavirus stimulus package, both small and medium Australian businesses have the leverage they need to keep their operations afloat and help the country’s own economy. Looking to keep your business strong and capable of overcoming the challenges posed by the COVID-19 pandemic? Schedule an online call or appointment with a business accountant in Gold Coast today to see how we can help you stay on the path towards success!