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Businesses and individuals can still take advantage of financial and taxation support.

JobMaker

From February 2021, businesses can take advantage of JobMaker payments for new employees subject to certain conditions.

JobMaker is worth $200 per week for each new employee aged 30 years or under, or $100 weekly for those between 30 to 35 years, for a maximium of 12 months from their employment start date.

Apprentice/trainee wages subsidy

If you employ a new apprentice or trainee, your business could be eligible to receive 50% of their wage. The subsidy is limited to a maximium of 50% of their wage. The subsidy is limited to a maximium of $7,000 per quarter up to September 2021.

NEWSPRESS: Under recent changes, the government has announced that the subsidy will be extended and run for 12 months from the date the person starts with their employer. Apprentices have to be signed up before the end of September 2021.

Loss carry-back

Companies with a turnover of less than $5 billion will be allowed to carry-back tax losses generated in the 2020, 2021 or 2022 income years to offset previously taxed profits made in the 2019 or later income years.

The carry-back rules will be implemented by way of a refundable tax offset that is generated in the year the loss is made.

Instant asset write off

Businesses that invest in new assets such as plant and equipment, IT equipment or office fitout can claim an immediate tax deduction until 30 June 2022. For businesses with turnover of less than $50m, the instant asset write off can apply to second-hand depreciating assets.

If you are considering buying a new car for the business, the maximium instant writeoff is $59,136 for the 2020-2021 financial year for a passenger vehicle designed to carry less than one tonne and fewer than 9 passengers.

Fringe benefits tax exemptions

From April 2021, the 47% fringe benefits tax (FBT) will no longer apply to SMEs that provide employees with car parking and a variety of work-related devices such as mobile phones and laptops.

Also, certain staff retraining costs are exempted from FBT to encourage employers to help workers transition to new employment opportunites within or outside their business.

Home Office costs

Employees working from home due to COVID-19, can claim up to 80c per hours worked. The rate is available up to 30 June 2021.

The 80c rate covers:

electricity for lighting, cooling or heating and running electronic items used for work (for example, your computer), and gas heating expenses

the decline in value and repair of capital items, such as home office furniture and furnishings including capital items that cost less than $300

cleaning expenses

your phone costs, including the decline in value of the handset

your internet costs

computer consumables, such as printer ink and stationery

the decline in value of a computer, laptop or similar device.

Expanded SME Loan Guarantee Scheme

The Federal government has announced that it will expand and extend its Coronavirus SME Loan Guarantee Scheme as part of its commitment to support up to $40 billion in lending to small and medium enterprises. 

The SME Recovery Loan Scheme is specifically targeted at SMEs currently receiving JobKeeper. The scheme is only open to recipients of the JobKeeper payment between 4 January 2021 and 28 March 2021.

It will see the government take on more of the guarantee, moving from a 50/50 backing with banks to an 80/20 split.

The expanded scheme will also increase the size of eligible loans (which can be either secured or unsecured, excluding residential property), increasing from $1 million under the current scheme to $5 million.

Loan terms will increase from five to 10 years and lenders will be allowed to offer borrowers a repayment holiday of up to 24 months.

The interest rate on loans will be determined by lenders, but will be capped at around 7.5 per cent, with “some flexibility for interest rates on variable rate loans to increase if market interest rates rise over time".

 

Please contact our office if you wish to discuss any of the above incentives further.

Older: Tax Planning 2021

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