Update Economic Stimulus Package (Tax & Commercial)


2nd Stage

The Prime Minister has announced a second-stage $66 billion economic stimulus package. Here is a summary of some of the measures based on the available information:

Support for small business – Increased PAYG withholding tax rebate

PAYG withholding tax rebate increases from $25,000 to $100,000. Timing of this may be over the period of 6 months. This is available to Not-for-profits and small businesses with a turnover under $50 million. The payments will be delivered by the Tax Office as a credit on activity statements from late April.

Access to cheap government guaranteed loans

According to AFR, the loans will be interest free for the first six months and will be for a maximum of $250,000 over three years. The government will guarantee 50 per cent of each loan. Details of how to apply the loans to be announced.

Access to superannuation

The Government will allow people to access up to $10,000 from their superannuation this financial year and in 2020-21. People will not pay tax on the money they access, and withdrawals will not affect Centrelink or veterans' payments. Suggest hold off withdrawals until this is legislated.

Reduction minimum pension

There will also be a temporary 50% reduction in superannuation minimum drawdown requirements for account-based pensions in 2019-20 and 2020-21. Please note above is not yet legislated.

Third Bailout coming

According to the financial review, the third package is likely to include more wage subsidies for businesses in some industries.

Important: Clients should not act solely on the basis of the material contained in this newsletter.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.Client Alert is issued as a helpful guide to cclients and for their private information.Therefore it should be regarded as confidential and not made available to any person without our prior approval.

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