We are all being impacted by the new corona virus known as COVID-19 and I’m sure we are coming to realize the implications it’s having on the way we go about our day. Here at Munro’s we have been briefing our team on good hygiene habits within our office, keeping them up to date with latest Government guidelines on travel and following the protocols around monitoring our health, isolating ourselves where we may be at risk of passing on the virus and ensuring we protect as best we can the people around us.
In terms of communicating with us, our most popular avenues continue to be email and phone, with occasional face-to-face meetings during the week. We have the ability to meet via Skype as well and only yesterday, I had a meeting with a client via Skype which went very well. So, please keep in mind we have the ability and tools here to communicate in a variety of ways and we are only too happy to use them.
There is no doubt businesses are being impacted by the virus, both the uncertainty it is creating in our community and the impact on our economy. Some businesses – tourism and hospitality immediately come to mind, are already feeling the effects and I’m sure this will filter through to most businesses over the next few months. Here at Munro’s, we are pro-actively looking at what we can do to minimize the impact on our business. Of immediate concern for us is making provision for our staff to be able to work from home in the event they have to self-isolate or quarantine themselves. This will ensure we are still able to continue to service your needs and allow our business to keep on working.
Have you considered what you can do in your business to try and minimize the impact of the virus? If you would like to trouble shoot some scenarios or simply use us as a sounding board for how it might impact your business, then please don’t hesitate to contact us for a chat. We’re always available to help where we can.
Today, the Government announced a range of stimulus initiatives to minimize the economic impact of the virus and we have provided a brief summary below:
- For businesses with turnover up to $500 million, from today until 30 June 2020, they will be able to get an immediate tax deduction for purchases of plant, equipment and vehicles worth up to $150,000 – so instead of depreciating these items over a number of years, your business will be able to expense it in the year spent. For example, buying a new or secondhand truck worth $130,000 for a freight business.
In addition, up until 30 June 2021 – businesses with a turnover of up to $500 million will be able to deduct an additional 50 per cent of a new assets cost in the year of purchase for those assets being depreciated. For example, a farmer buying a new harvester for $500,000 would get an immediate deduction of $250,000, on top of the depreciation claim on the remaining balance of $250,000.
- Small to medium sized businesses (that’s those with a turnover of less than $50 million) who employ staff will also get tax free cash assistance of between $2,000 to $25,000 to assist with paying wages or hiring extra staff. It will be assessed via your Business Activity Statement or Instalment Activity Statement lodged after 28 April. The amount of the credit is calculated as 50% of the payg tax withheld on your Activity Statement and will be credited to your activity statement account (so it either reduces your activity statement bill or increases your refund due).
In addition, for those eligible businesses (Employers with less than 20 fulltime employees) employing apprentices/trainees, they can apply for a wage subsidy of up to 50% of the apprentices/trainees wages for up to 9 months from 1 Jan 20 to 30 Sep 20. It’s capped at $7000 each quarter per each eligible apprentice/trainee.
- Welfare recipients and pensioners will also receive a one off tax free cash payment of $750 from 31 March 2020.
If you are thinking of updating your plant list or you do employ staff then the incentives above will be very useful. If you would like to get an idea of the immediate tax saving of any proposed plant purchase or the amount of wage assistance, then please get in contact with us and we’ll provide the answer.
In the meantime, stay safe and keep ahead of the virus.