WA Govt's Second Grant for Small Businesses in Perth
$3000 lockdown assistance has been promised in round 2 to eligible businesses
Due to COVID lockdown number of small business has faced difficult challenges, economy and consumers stayed home to slow the spread of the virus. To stay afloat, employers adapted on the fly and found creative ways to change their operating models.
Still, many small businesses have been affected due to two lockdowns and our Western Australian Government does realize it and announced to support our small businesses during these pandemic times. $30 million has been committed to helping the eligible business in the Perth, Rottnest and Peel regions from this setback.
In round 1 (which is closed for application now) payment of $2000 will be made to the eligible business that applies to the terms and conditions and the eligibility criteria. In round two, Small Business Lockdown Assistance Grants program will provide assistance of $3,000 to small businesses in Perth, Peel and regional WA in industry sectors most severely impacted by the recent four day lockdown and subsequent restrictions.
These grants are not to cover the lost revenue or potential profits, these payments are to offset some of the direct costs incurred due to lockdown-such as loss of perishable goods or cancellations, also lost bookings due to cancellations.
Relief Packages for Small Business
There has been the latest update from Western Australian Government to support the small business through the relief measures/packages during this Pandemic (COVID) period, these measures are temporary, targeted, and scalable. These packages are mainly to support the small business and to keep employees at work.
The small business relief packages are available for:
1. SME recovery Loan Scheme:
You may be eligible to apply for a business loan under the SME Recovery Loan Scheme if you have received the job keeper payment between 4th January 2021 to 28 March 2021.
The business owners get an opportunity to refinance existing loans with a commercial lender and with the following features:
- Government Guarantee- 80%
- The ability for lenders to offer a repayment holiday of up to 24 months.
- Interest rate cap-7.5 %
- Maximum Loan – $5 million
- Maximum loan term -10years
2. JobMaker Hiring Credit:
To encourage businesses to hire young people for new positions- the Australian Government has introduced JobMaker Hiring Credit. The payment provides an incentive for employers to hire young job seekers, by delivering payment to employers to help support the new employee’s wage costs. Eligible employers can receive the payment for up to 12 months (from 7 October 2020 to 6 October 2021).
For new jobs that employ an eligible young person. Under the program, employers will be credited $200 a week for additional employees aged 16 to 29 years and $100 a week for new employees aged 30 to 35 years who meet the eligibility criteria.
3. Tax and FBT Concessions:
- For individuals a reduction in the tax rate
- Immediate deductions of some start-up expenses
- FBT changes on car parking and work-related electronic devices provided to the employees.
- Incentives on research and development (R&D).
- Loss carry back provision.
4. Greater leniency for insolvency and bankruptcy.
For small businesses, the threshold at which a creditor can take action has been increased from $2000 to $20000.The mandatory response time has also been extended from 21 days to 6 months. Temporary relief for directors from any personal liability for trading while insolvent has also been announced.
5. Cash flow boost for the employers:
Cash flow boost amounts will be granted to eligible employers between $20,000 and $100,000. Eligible entities will receive cash flow boost credit when lodging activity statements for tax periods from March to September 2020.
6. Phase 2 -SME Guarantee Scheme
SME Guarantee Scheme -second phase- the program focus will be access to longer and more affordable credit that can be used to help businesses fund a wide range of investments. A business will be eligible to borrow up to $1 million for a term of up to five years.
7. Boosting Apprenticeship Commencements wage subsidy
Employers eligible can apply for a wage subsidy of 50% of an apprentice’s or trainee’s wage between 5th October 2020 and 30 September 2021. Maximum of $7,000 per quarter can be reimbursed by the Businesses.
8. Tax Relief
If the business operations have caused a fall behind due to the pandemic an Australian Tax Office (ATO) will also consider relief for certain tax obligations to certain businesses, including deferred tax payment up to 4 months.
9. Instant asset write-off threshold and accelerated depreciation increase:
With regards to the COVID-19 pandemic the instant asset write-off threshold has been temporarily amended, it allows all the businesses with an aggregated turnover of less than $5 billion to deduct the full cost of eligible depreciable assets of any costs, installed and ready for use between 6th October 2020 to 30 June 2022.
Small businesses with an aggregated annual turnover of less than $50 million can also claim the full expense of second-hand purchases. Small businesses with an aggregated turnover of less than $10 million can also deduct the balance of their simplified depreciation pool at the end of the income year, while full expensing applies.
For more information on Tax relief and instant asset write-off threshold please go through the ATO website.
*NETCorp is not an accounting firm, HR specialist, or financial advisors and therefore we encourage you to do your on fact finding research and not take what has been stated in this article as factual or true