In this Sky Update, we bring you all the latest tax news along with some other items that may pique your interest.
JobKeeper Scheme Extended
On the 21st of July the Government announced that the JobKeeper scheme will be extended to the 28th of March 2021.
As part of the announcement, the Government will not be making any changes to the original phase of the JobKeeper scheme that is due to end on the 28th of September.
In order to claim for the period commencing on the 29th of September and ending the 3rd of January 2021, it will be necessary to have satisfied the decline in turnover test for both the June and September 2020 financial quarters. Claims for the period commencing on the 4th of January to the 28th of March 2021 will be subject to having satisfied the decline in turnover test for each of the June, September and December 2020 financial quarters.
The decline in turnover test remains unchanged from the first phase of the JobKeeper scheme, being:
- A 50% decline in aggregated turnover for businesses with turnover of more than $1b;
- A 30% decline in aggregated turnover for businesses with turnover of $1b or less; and
- A 15% decline in aggregated turnover for ACNC registered charities (excl. schools & universities).
In the extension period, the JobKeeper Payment rates will be:
- From 28 September 2020 to 3 January 2021: $1,200 per fortnight for all eligible employees who, in the four weeks before 1 March 2020, were working 20 hours or more per week, and $750 per fortnight for employees who were working less than 20 hours a week.
- From 4 January 2021 to 28 March 2021: $1,000 per fortnight for all eligible employees who, in the four weeks before 1 March 2020, were working for 20 hours or more a week, and $650 per fortnight for employees who were working less than 20 hours a week.
The Treasurer is required to make a Legislative Instrument in order to give affect to the extension of the scheme. This Legislative Instrument will include the formal rules which will govern how the scheme works during the extended period.
Once made, the Legislative Instrument will be essential reading for anyone wishing to participate in the JobKeeper scheme beyond the 28th of September. In the meantime, additional information can be found on the Treasury website here.
Fair Work Ombudsman 2020/21 Priorities
Fair Work Ombudsman Sandra Parker has announced the FWO’s strategic priorities for the 2020/21 financial year.
Not surprisingly, the main priority of the FWO is to support workplaces through the COVID-19 pandemic and subsequent recovery phase.
The priority sectors and issues that the FWO will be focussing on this financial year are:
- large corporate underpayments;
- fast food, restaurants and cafés;
- franchise arrangements; and
- sham contracting.
With these sectors and issues having been prominent in the media last financial year, it is no surprise that the FWO is continuing to focus on them.
Whilst the COVID-19 pandemic has caused significant disruption, businesses cannot afford to take their eye off their compliance obligations.
If you need assistance to ensure that your business is compliant, please get in touch.
Tax Time 2020
In-line with the directions of the Victorian Chief Health Officer, our offices will remain closed until further notice.
Whilst our offices remain closed, we are still very much at work and are here to assist you with your business and taxation requirements.
The safety of our clients and staff is paramount and we take very seriously the directives of the Chief Health Officer to prevent community transmission of Coronavirus.
Unfortunately, this means that we are unable to meet with our clients and offer face to face appointments for preparation of tax returns at this time. In light of this, we have arrangements in place to run tax time appointments using video conferencing technology or by telephone.
At the time of writing we have processed a significant number of 2020 income tax returns and we are very happy with how our contactless processes are working.
In the meantime, we will continue to monitor the directives of the Chief Health Officer and look forward to being able to catch up in person soon.
Victorian Business Support Fund Expansion
Due to the reinstatement of stage 3 restrictions in metropolitan Melbourne, the Victorian Government has expanded the Business Support Fund to offer an additional $5,000 grant.
To be eligible, businesses must:
- Operate a business with an address located in one of the 31 metropolitan Melbourne LGAs and Mitchell Shire subject to the return to Stage 3 ‘Stay at Home’ restrictions;
- Be a participant in the JobKeeper scheme;
- Employ people and be registered with WorkSafe as at 30 June 2020;
- Have an annual payroll of less than $3m for the 2019/20 financial year;
- Be registered for GST as at 30 June 2020;
- Hold an ABN that was active as at 30 June 2020; and
- Be registered with the responsible Federal or State regulator (Eg ASIC).
Businesses that do not employ people will not be eligible to apply.
Applications for the grant close on the 19th of August. Information about applying can be found here.
Loan Repayment Deferral Announcement
Earlier in July, the Australian Banking Association announced that the banks will implement a second phase of support to assist customers that had previously elected to defer the repayments by up to six months.
The banks will be contacting customers to seek to resume repayments through a restructure or variation to the loan. Where customers continue to face financial difficulties, they may be able to extend their deferral for a further four months.
If you are continuing to face financial difficulties associated with the COVID-19 pandemic, we recommend that you contact your bank to investigate the option of extending your repayment deferral.
Quote of the Month
Recent developments in Victoria and New South Wales have made it abundantly clear that the COVID-19 pandemic is far from over.
It is likely that there will be ongoing restrictions for some time to come that will have a significant impact on our communities and on the domestic and global economies. In the Economic & Fiscal Update delivered on the 23rd of July, the Treasurer has predicted a 2.5% fall in real GDP in 2020/21 and for the unemployment rate to reach 9.25% in December 2020.
The prospect of a return to life and business as usual in the short term is now decidedly remote. In fact, many pundits are predicting that the impacts of the COVID-19 pandemic may be so far reaching and prolonged that our way of life and economy will undergo permanent structural change.
With this as a backdrop, we should contemplate the words of the renowned author and futurist, Buckminster Fuller.
“You never change things by fighting the existing reality. To change something, build a new model that makes the existing model obsolete.”
Let’s not fight our existing reality of a world disrupted by the COVID-19 pandemic. Instead, let’s focus our energies on adapting to our circumstances and on building new ways of doing things to achieve prosperity in a world in which COVID-19 is a reality.
Sky Accountants Ballarat
Phone: 1300 328 855
Office Address: 902 Howitt Street, Wendouree, Victoria 3355, Australia
Postal Address: PO Box 2234, Bakery Hill, Victoria 3354
Sky Accountants Sunbury & Gisborne
Phone: 03 97444522
Sunbury Office Address: Suite 13, 33-35 Macedon Street, Sunbury, Victoria 3429, Australia
Gisborne Office Address: 45 Hamilton Street, Gisborne, Victoria 3437, Australia
Postal Address: PO Box 270 Gisborne Victoria 3437