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Stimulus Package COVID-19

COVID-19 has created an uncertain time in the economy and some businesses are starting to feel the impact. Because of this, the Morrison government has announced that they will be releasing a stimulus package to help the economy to weather this storm.

How is COVID-19 affecting businesses?

Looking past the health issues, the fear, uncertainty and panic is starting to take its toll on the business community. Businesses that are already starting to feel the pinch are:

  • Restaurants,
  • Pubs,
  • Cafes,
  • Clubs,
  • Travel & Accommodation,
  • Gyms,
  • Playgrounds & Recreation,
  • Retail & Shopfront businesses,
  • the share market and
  • the Australian dollar

Reasons for the drop in business can be attributed to:

  1. People are unwilling to go into public places,
  2. Government limitations, restrictions and guidelines, and
  3. Australians now watching their spending due to fears of a major economic impact.

What will Alliance Accounting do to assist you?

We have implemented an internal COVID-19 monitoring system to track its progress so that we may better understand the impact that coronavirus may have on your business and the economy. The team are also closely monitoring the stimulus package announcements.

Alliance Accounting would like to emphasise that we are here to help at this time. If your business is affected, please contact us.

Our Recommendations

it is important to understand that financial help may not be enough to help your business survive. It is important to plan, implement, and review as business conditions change daily.

The old adage of cash is king cannot be more true in these circumstances. Those that start planning and preparing will survive the economic instability and will come out stronger once the economy stabilises as your competitors start to collapse leading to a market with hopefully, greater demand than supply.

We advise that you:

  • Start writing a plan in preparation for what could happen. This plan could be put in place for now, and future times of uncertainty. When times get tough, it will be easier to enact a plan which you thought through when you had a clearer mind rather than trying to come up with ideas when in panic. Tips for the plan include:
    • Set clear and specific targets that define when you will take actions. For example, “if our bank account balance drops below $xx, we will…”, “if we lose XX number of clients, we will…”
    • Set clear and specific actions, for example, “we will reduce staff hours by x hours, We will stop using 2 casual workers, we will ask for a rental decrease or holiday, Etc.
    • Plans such as these are incredibly helpful for many scenarios. While you are at it, consider plans for any future events, for example, floods, fires, power outages, etc.
  • Review your expenses. When was the last time you reviewed your electricity costs, your phone bills, your insurances, etc?
  • Consider what unnecessary spending you could cut back
  • Consider the impact this could have on your suppliers, your customers and your staff and how it may impact you
  • Revisit your marketing. At this time, with competitors looking to cut costs, they may switch off their marketing to their detriment. After having considered what impact an economic slowdown could have on your customers, think about what customers could be looking for and how you could attract them. If competitors start collapsing, how are clients going to find you?

Let’s support each other. We have many clients who are marketers, advertisers, printers, mortgage brokers, real estate, IT, tradies, etc. If you have a need for a service, feel free to reach out to us for the details of one of our trusted clients.

Details of Assistance from Government Stimulus Package and External Bodies

The Government has now released a second stimulus package. Some of the previously announced stimulus package items have now been turned on their head. The Stimulus Package, as of Monday 30th March 2020, is as follows:

 Boosting cash flow for employers package

The government stimulus package is boosting cash flow for employers by providing up to $100,000 to eligible small and medium-sized businesses with a minimum of $20,000.

Small and medium-sized business entities with an aggregated turnover of less than $50 million and that employ workers will be eligible.

  • The payment will be delivered by the ATO as an automatic credit in the activity statement system from 28 April 2020.
  • Initially, employers that withhold tax to the ATO on their employees’ salary will receive a payment equal to 100% of the amount withheld, up to a maximum payment of $50,000 for PAYG withheld from:
    • January to June for Quarterly lodgers
    • March to June for Monthly lodgers.
  • To provide a similar treatment for quarterly lodgers, the payment for monthly lodgers will be calculated as three times the rate (300 per cent) in the March 2020 activity statement.
  • Initially, employers that pay salary and wages will receive a minimum payment of $10,000, even if they are not required to withhold tax.
  • The payments will only be available to active eligible employers established prior to March 12 2020.
  • Those with withholdings below $20,000 will receive the following
    • $10,000 in April,
    • $5,000 in July, and
    • $5,000 in October,

Additional payment

  • An amount equivalent to what was received from in the January to March period will be paid as-is:
    • Quarterly lodgers – 50% in July and 50% in October
    • Monthly lodgers – 25% in July, 25% in August, 25% in September, 25% in October
  • the additional payments will be delivered as an automatic credit in the activity statement system.


Individuals affected by the Coronavirus will be allowed to access up to $10,000 of their superannuation in each of the 2019/2020 and 2020/2021 financial years. Individuals will not need to pay tax on amounts released, and the money they withdraw will not affect Centrelink or Veterans Affairs payments

You need to meet at least one of the following eligibility criteria to access your super early as part of this scheme:

  • You’re unemployed
  • You’re eligible to get a job seeker benefit, youth allowance for jobseekers, parenting payment or farm household allowance
  • You’ve been made redundant or had your working hours reduced by 20% or more since 1 January 2020
  • You’re a sole trader and you’ve had to pause your business operations, or your turnover has fallen by 20% or more, since 1 January 2020

You can apply through MyGov.

Income support for Individuals

The government is temporarily expanding eligibility to income support payments and establishing a new, time-limited coronavirus supplement to be paid at a rate of $550 per fortnight. This supplement will be paid to both existing and new recipients of the eligible payment categories. These changes will apply for the next six months.


The income support payment categories eligible to receive the coronavirus supplement are:

  • Jobseeker payment
  • Youth allowance job seeker
  • Parenting payment
  • Farm Household allowance
  • Special benefit recipients

Anyone who is eligible for the Coronavirus supplement will receive the full rate of the supplement of $550 per fortnight

Expanded access

For the period of the Coronavirus supplement, there will be expanded access to the income support payments listed above.

  • Expanded access: Jobseeker payment and youth allowance jobseeker criteria will provide payment access for permanent employees who are stood down or lose their employment, sole traders, self-employed, casual workers, and contract workers who meet the income test
  • Reduced means testing; Asset testing for jobseeker payment, youth allowance jobseeker and parenting payment will be waived for the period of the Coronavirus supplement. Income testing will still apply

People will not be permitted and will need to declare that they are not, accessing employer entitlements or income protection insurance, at the same time as receiving jobseeker payment and youth allowance jobseeker under these arrangements.

Payments to support households

The government stimulus package is providing two separate $750 payments to social security, veteran and other income support recipients and eligible concession cardholders.

The first payment will be available to people who are eligible payment recipients and concession cardholders at any time from 12 March to 13 April.

The second payment will be available to people who are eligible payment recipients and concession card holders on 10 July 2020.

A person can be eligible to receive both a first and second support payment. However they can only receive one $750 payment in each round of payments.

The payment will be exempt from taxation.

CORONAVIRUS SME GUARANTEE SCHEME – Business Loans up to $250,000

The Coronavirus SME guarantee scheme will provide support for businesses to meet their ongoing fixed obligations such as rent, utilities and employee expenses

Under the scheme, the government will provide a guarantee of 50 per cent to small business lenders for new unsecured loans to be used for working capital.

SME’s with a turnover of up to $50 million will be eligible to receive these loans

The government will provide eligible lenders with a guarantee for loans with the following terms

  • Maximum total size loans of $250,000 per borrower
  • The loans will be up to three years, with an initial six month repayment holiday
  • The loans will be in the form of unsecured finance, meaning that borrowers will not have to provide an asset as security for the loan

Other updates and assistance

  • RBA has cut rates by 0.25% in an emergency meeting in March. Many banks have passed on the rate cut in one way or another.
  • Government and banks have now worked out to offer a 3-6 month loan repayment holiday for businesses and homeowners on business loans, equipment finance and home loans.
  • Banks are allowing the opportunity to convert your loans to interest only to reduce your monthly loan repayments.
  • Some banks have increased interest income on term deposits.
  • Some banks have decreased their fixed rate interest rates to as low as 2%.
  • Temporary 50% reduction in superannuation minimum pensions for account-based pensions in 2019-2020 and 2020-2021.
  • Temporary relief for directors from any personal liability for trading while insolvent.
  • Be wary of scams from emails, texts and door knockers providing payment or assistance.
  • Restrictions on gatherings over 500.
  • Restrictions on indoor gatherings of 100.
  • Indoor gatherings require that each attendee including staff have a minimum of 4 square meters of floor space.
  • Closure of gyms, sporting venues, cinemas, restaurant (except take away), etc.

It would be worthwhile looking at taking advantage of some of these offers in order to save cash from now. Waiting till you are in crisis may be too late.

Proposed assistance – details to come

  • Assistance to tenants struggling to pay rent
  • Potential further stimulus incentives from both state and federal governments.

We express the importance to start preparing and planning! The Government and banks never hand out free money unless they believe there is some urgency, we ask that you consider the same level of urgency in your business.

Stay safe, all the best, and remember, we are here for you. Contact the team at Alliance Accounting if you require any assistance throughout this difficult period.

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