Economic stimulus package - Round Two - 23rd March 2020

A. Federal Government Announcements

Yesterday 22 March 2020, the Treasurer has announced its second Economic stimulus package.

The key business tax measures include modified cash flow assistance for employers:

  • The previously announced tax-free payment of $25,000 for employers under $50m turnover (based on prior year turnover) will be increased to $50,000.
  • The minimum payment will be increased from $2,000 to $10,000, and will include Not For Profit Organisations (NFP's).
  • The payment will be based on 100% (instead of 50%) of the PAYG W amount reported in the activity statement for March 2020 and June 2020 (for quarterly lodgers) and March 2020, April 2020, May 2020 and June 2020 (for monthly lodgers).
  • An additional payment equal to this amount will also be available from July to October 2020, taking the total available payments to $100,000 (minimum $20,000).
  • The payments will be automatically credited by the ATO through the activity statement system.
  • The payments will only be available to active eligible employers (other than charities) established prior to 12 March 2020.
 The key superannuation and income support measures are:

  • Tax-free early access to superannuation, up to $10,000, from mid-April to before 1 July 2020. Up to a further $10,000 will be available from 1 July 2020 for approximately three months.
  • You must apply to the ATO, separate arrangements will be made for Self Managed Superannuation Funds and the following conditions apply: 
           - must be unemployed; or
           - eligible for a job seeker payment; or
           - made redundant on or after 1 January 2020: or
           - reduction in working hours by 20% or more; or
           - if a sole trader, the business was suspended or a reduction in turnover of 20% or

  • Halving of minimum pension drawdown requirements (i.e. 4% becomes 2% for the remainder of the year ended 30 June 2020 and for the full year ended 30 June 2021.
  • The previously announced $750 payment for income support recipients and concession card holders will now be two separate $750 payments: one from 31 March 2020 and the other from 13 July 2020.
  • There will also be a new time-limited Coronavirus supplement to be paid at a rate of $550 per fortnight from 27 April 2020 for the next six months.
  • Income support recipients will also have:
           - expanded access
           - reduced means testing
           - reduced waiting times
           - claims accelerated 
           - the application process streamlined 
There is no change to the other measures previously announced on 12 March 2020 that included:

  •  Increased IAWO i.e. increased asset threshold of $150,000 and turnover threshold of $500m until 30 June 2020;
  • Limited 50% depreciation incentive until 30 June 2021;
  • 50% wages subsidy for apprentices and trainees until 30 September 2020.
 B. State Government Announcements

The New South Wales State Government also announced a $2.3 billion coronavirus stimulus package which includes:

  • Payroll Tax Waiver - $450 million has been allocated to waive payroll tax for businesses with payrolls of up to $10 million for three months. The State Government said these businesses would not have to pay the tax for the rest of this financial year.
  • When companies lodge their Annual Statements for the year ended 30 June 2020, they will receive a 25% reduction of their primary payroll tax due.
  • The next round of payroll tax cuts has also been brought forward to raise the threshold limit to $1 million for the next financial year.
C. Coronavirus and Australian workplace laws

Last week the Fair Work Ombudsman (FWO) released an update on workplace entitlements and obligations. As there has been a huge amount of traffic on the FWO website, the page has been inaccessible so we have made a copy available for you here.
Please note that advising on staffing issues is beyond our scope of works and if you have any complex Human Resource issues, we strongly recommend you speak to your solicitor.

D. The Australian Banking Sector
Small businesses will be allowed to defer loan repayments for six months under new emergency measures announced by the Australian Banking Association last week.

E. Creating and reviewing business continuity plans

Our friends at Xero encourage all business owners to consider a written plan for how to cope with disruption to your business. If you already have a plan in place, it's worth reviewing it on an ongoing basis. 

A sound business continuity plan will help you prepare for any disruption so you can return to normal as quickly as possible. has some useful resources on how to protect yourself and reduce risks to your business when things don't go to plan.

F. Predicting cash flow

It's always a good idea to keep a watchful eye on cash flow, particularly during times of uncertainty when supplies and sales may slow down. For Xero clients you may like to read preparing a cash flow forecast or MYOB clients can access cash flow forecasts here.

G. MYOB have also announced pricing and financial support for their clients:

  • The immediate suspension of price rises until further notice.
  • A review of payment terms to provide flexibility to industries hardest hit.
  • The implementation of a dedicated support team to manage hardship applications.
  • Providing information on access to government grants.
H. General Information - Staying well informed

Keeping reliably informed, understanding the symptoms of COVID-19 and staying up to date with developments will help you and your clients to make better decisions amongst all of the confusion. Keep up to date with the latest alerts here:
And finally

I. Taking care of your wellbeing

Beyond Blue support service is available 24 hours a day, 7 days a week to support the mental health of people affected on 1300 22 4636. 

Emotional responses after a disaster has information about normal responses to disasters, what's beyond a normal response and some tips on dealing with the emotional impact of a disaster.

More detailed information is available in the booklet Looking after yourself and your family after a disaster  

We hope that you maintain your health and wellbeing and find a positive focus during this time. We are here for you. Please do reach out if you need help or support.

Stay well Australia, we are thinking of you.

AV Chartered Accountants - Committed to Your Business Success

Two convenient locations:

WARATAH +61 2 4629 5533  | MAITLAND +61 2 4933 6100

Email: au

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