13 July 2021
by David Prichard
- Related topics
- Corporate Tax & Regulatory
This afternoon, Scott Morrison along with Gladys Berejiklian and Dominic Perrottet announced further measures for individuals and businesses in NSW that have been adversely affected by this current lockdown.
As always some of the detail is yet to be announced, however we expect this within hours / days as the State and Federal Government want to get relief out to those who need it quickly.
Here are the headlines regarding the new Business Support Payment:
- The NSW and Federal Governments will enter into a new 50/50 cost sharing arrangement for this new support payment which starts from week 4 of a lock down (this Sunday for NSW).
- To be eligible businesses need an annual turnover between $75,000 and $50 million who can demonstrate a 30 per cent decline in turnover for an equivalent two-week period in 2019. Whilst no guidance has been provided it would be logical to assume that these thresholds are based on a grouped basis.
- There is one important prerequisite: to receive the payment, eligible entities will be required to maintain their staff, this includes full-time, part-time and long-term casuals as of 13 July 2021. If you make staff redundant you will no longer be eligible.
- Eligible entities, which includes not-for-profits, will receive payments of between $1,500 and $10,000 per week based on the level of their NSW payroll. It will equate to 40 per cent of a business’s payroll payment, at a minimum of $1,500 and a maximum of $10,000 per week.
- Payments will be administered by Service NSW rather than the ATO.
- Payroll tax waivers of 25 per cent for businesses with wages of between $1.2 million and $10 million that have experienced a 30 per cent decline in turnover.
- Smaller businesses earning more than $30,000 but less than $75,000 will also receive a backdated $1,500 per fortnight payment from week one of the lockdown if they have seen a 30 per cent reduction in turnover for a similar period.
- For sole traders (ie businesses without staff) the payment will be set at $1,000 per week.
- The NSW government will pay assistance to people outside Federal government-declared hotspot areas. From July 18, the payment will be available to those outside federal hotspots in NSW that meet the criteria for the payment. Gladys understands that people in Regional NSW are feeling the flow on effects of the Sydney lockdown as borders are closed and travel restricted.
- From week four of the lockdown (which is this Sunday for Greater Sydney) with respect to a declared hotspot by the Federal Government, the Covid-19 Disaster Payment will increase to $600 if a person has lost 20 or more hours of work a week, or $375 if a person has lost between 8 and less than 20 hours of work a week. It’s not called JobKeeper but looks a little similar.
- Eligible workers are Australian citizens, residents and visa holders who are permitted to work in Australia and aged 17 years and older.
- It will become a recurring payment for approved recipients for as long as the Federal Government declared hotspot and lockdown restrictions remain in place.
- People will be eligible for the payment even if they are still working, provided they have lost more than 8 hours or a full day of work each week.
- It should also be noted that the same support will be offered to any other State or Territory that experiences an extended lockdown.
The NSW Government also announced support to commercial tenants and retail tenants. They will be mandating that there will be no lockouts, or evictions during this period of time. Also, land tax relief equal to the value of rent reductions provided by commercial, retail and residential landlords to financially distressed tenants, up to 100 per cent of the 2021 land tax year liability.
There is also a deferral of gaming tax assessments for Clubs until 21 December 2021 and Hotels until 21 January 2022.
NSW will also provide residential tenancy protections by ruling out any evictions for the next 60 days for workers who have seen an income reduction of at least 25 per cent.
Lastly, a $17.35 million mental health support package for NSW was also announced with services through Lifeline, Headspace and Kid’s Helpline.
There will clearly be more detail to come in respect of the above announcements so that businesses will be able to determine whether they qualify. The full eligibility criteria for both the business support measures are currently being developed by Service NSW and Services Australia.
We will provide you with an update in this regard when we are able.
ESV is here to help our clients navigate through this challenging period, please reach out to your ESV Engagement Partner if you have any questions, we are here to help and welcome your call – even if you just need someone to chat too.