The Federal Government is providing cash flow boosts to support businesses and not-for-profit organisations through the economic downturn associated with COVID-19. The first cash flow boost of up to $50,000 has been delivered and you should now be preparing for the arrival of the second boost. Read more
As of 1 July 2020 a new law is in place that poses a major risk for Board Members and Company Executives. Read more
It can take some planning to get your finances in order for the end of financial year, and this year may look a little different, come 30 June. The COVID-19 pandemic may have impacted your circumstances and therefore your situation could have changed. Read more
Winter is here and we are almost at the end of another financial year, and what a year it’s been! With so many Australians impacted by fires, floods, drought and now COVID-19, let’s hope the new financial year sees a more stable economic environment.
AFS finalists in the Australian Accounting Awards
AFS & Associates has been shortlisted and named as finalists in the Australian Accounting Awards for Wellness Program of the Year and Professional Development Program of the Year! Read all about it in our client update.
We look forward to the awards night in June. Fingers crossed we take home a win or two!
As May unfolded, hopes grew of economic re-opening. Reserve Bank Governor Philip Lowe told a Senate Committee on COVID-19 the economic downturn was less severe than feared due to Australia’s better than expected health outcomes and government stimulus and support. Unemployment rose from 5.2% to 6.2% in April, but without JobKeeper support payments it would have been closer to 9.6%.
We hope you enjoy this edition of our client update. We cover the following:
- Business support during COVID-19
- Take advantage of the instant asset write off before 30 June
- ATO opens applications for early release of superannuation
- Working from home: what can I deduct?
- Scams targeting natural disaster victims
- Employers need to pay superannuation now or be penalised.
Should you wish to investigate any of these matters further, please contact our office on 03 5443 0344.
Announced on 4 June 2020, the HomeBuilder Program will provide all eligible owner-occupiers (not just first home buyers) with a grant of $25,000 to build a new home or substantially renovate an existing home.
It is hoped HomeBuilder will help to support the residential construction sector including businesses and sole-trader builders, contractors, property developers, construction materials manufacturers, engineers, designers and architects.
It is also a nice boost for Australian’s wanting to build their home or renovate existing houses.
Key details include:
- Applies to contracts entered into between 4 June 2020 to 31 December 2020
- The property value must be worth $750,000 or less (including land value)
- If doing a renovation, the value of property must be less than $1.5 million
- Renovation price range must be over $150,000 up to $750,000
- For singles, taxable income for 2018/19 or 2019/20 must be $125,000 or less
- For couples, combined taxable income for 2018/19 or 2019/20 must be $200,000 or less
- Construction must be contracted to commence by 21 June 2021
- Investors and owner builders will be ineligible
- This cannot be used for additions to the property that are unconnected to the place of residence such as swimming pools, tennis courts, outdoor spas and saunas, sheds or garages
- This can be used in conjunction with existing State and Territory First Home Owner Grant programs, stamp duty concessions and other grant schemes, as well as the Commonwealth’s First Home Loan Deposit Scheme and First Home Super Saver Scheme.
- i.e. an eligible first home buyer in Victoria will now get $45,000 in grants when building their first home.
HomeBuilder will be implemented via a National Partnership Agreement, signed by the Commonwealth and State and Territory governments. Information on when and how you will be able to access HomeBuilder will become available through the relevant State or Territory revenue office.
For full details on the program please see the following government pages:
If you have any questions about the grant please call us to discuss on 03 5443 0344 or email email@example.com
From 4 May, the Australian Taxation Office (ATO) opened the final reporting requirements for the JobKeeper Scheme.
The following steps will need to be completed before the JobKeeper payments will be processed by the ATO. Read more
If you qualify for the Government JobKeeper payments, it is important you update your payroll software so you can provide the Australian Taxation Office (ATO) with the information required in the correct format. If you process your payroll as normal or incorrectly there’s a chance your JobKeeper payments could be delayed or missed altogether. Read more
ATO extends initial JobKeeper payment deadline
The Australian Taxation Office (ATO) announced changes to the JobKeeper deadlines for enrolment and payment requirements, these deadlines are: Read more
The Prime Minister has announced a Code of Conduct (“the Code”) which outlines a set of principles for commercial landlords and tenants to operate within when negotiating any lease relief for tenants who are experiencing financial stress or hardship during COVID-19.
A summary of the principles are:
- Eligible tenants must have an annual turnover of less than $50 million per annum (pre-COVID-19)
- The tenant must be eligible for the JobKeeper Payment
- Landlords and tenants must negotiate in good faith
- The agreement must cover both the period of the pandemic and a reasonable recovery period
- Landlords must not terminate leases due to non-payment of rent
- Tenants must remain committed to the terms of their lease
- Landlords must offer qualifying tenants with cash flow relief in proportion to the loss of turnover they have experienced;
- At a minimum 50% of this reduction is provided as a rent free/rent waiver
- With the remainder offered as a deferral of rent, or as negotiated
- Payment of the rental deferrals can be amortised over the greater of the balance of the lease or for a period of no less than 24 months
- The landlord should seek to share any benefit it receives due to deferral of loan payments provided by a financial institution as part of the COVID-19 response
- Landlords should, where possible, waive recovery of other expenses or outgoings by a tenant during the period the tenant is not able to trade
- No fees or charges should be applied on any waived payments
- Landlords must not draw on tenants security for the non-payment of rent
- Landlords agree to a rent increase freeze
The Code was released on 7 April 2020 and comes into effect from 3 April 2020. For further details please refer to the National Cabinet Mandatory Code of Conduct.
Prior to the Code being released, along with Millson Developments and Beck Legal we provided our commercial landlord clients an outline of the Federal and State Governments announcements relating to moratorium on evictions and the stimulus and support packages tenants may have access to. You can view that here.
** VICTORIAN UPDATE **
Victorian Premier Daniel Andrews announced a $500 million package aimed at giving certainty to residential and commercial tenants and landlords where they are impacted by the economic disruption caused by the coronavirus pandemic.
Emergency legislation will be put to Parliament on Thursday 23 April in line with decisions of the National Cabinet’s Code of Conduct to reform residential and commercial tenancy laws.
The support includes:
- A temporary ban on evictions
- A pause on rental increases for six months
- Providing rent relief for tenants experiencing financial hardship
- Providing land tax relief for landlords.
To provide much needed peace of mind and security, evictions will be banned for residential tenancies for six months, except in some circumstances. The same rules apply for the non-payment of rent for commercial tenancies involving small and medium-sized businesses. Rental increases will also be banned for commercial and residential properties for the same period.Tenants and landlords who struggle to strike a deal over rent reductions will be given access to a fast-tracked dispute resolution service, with Consumer Affairs Victoria or the Victorian Small Business Commission mediating to ensure fair agreements are reached.
To encourage landlords to do the right thing by their tenants, the Government will provide land tax relief. If a landlord provides tenants with rent relief, they will be eligible for a 25% discount on their land tax, while any remaining land tax can be deferred until March 2021.
Consistent with the National Cabinet agreement to implement a mandatory code of conduct for commercial tenancies, the Government will also urgently legislate so that eligible small and medium sized businesses can be granted rental waivers or deferrals. Businesses are eligible for these measures if they have an annual turnover under $50 million per year and have experienced more than a 30% reduction in turnover due to coronavirus.
The Government will also create rental assistance for renters facing hardship due to coronavirus. To be eligible, renters will need to have registered their revised agreement with Consumer Affairs Victoria or gone through mediation, have less than $5,000 in savings and still be paying at least 30% of their income in rent.
As agreed by National Cabinet, these new measures will come into effect from 29 March for a period of six months.
If you would like to discuss any part of this blog contact your AFS accountant directly or call 03 5443 0344 or email firstname.lastname@example.org
Employee transport expenses is a commonly claimed tax deduction, however, many bring Australian Taxation Office (ATO) scrutiny upon themselves due to incorrect recording of deductible travel costs or lack of knowledge in regards to what can be claimed and what cannot be claimed. Read more