The 7 Key COVID-19 Relief Options For Your Medical Business
March 24th, 2020
As a client of MEDIQ, you are at the front line of the COVID-19 epidemic.
It is inevitable that all our clients will be impacted by COVID-19. However, rest assured that we will provide as much assistance as we can to help you through this difficult time.
Free Consultation with Ravi Agarwal
From Tuesday 24 March 2020 we will offer all existing and new clients a 20 minute free consult to discuss issues related to COVID-19. These consults will be by phone and I will call you at the scheduled time. I am opening up my diary from 8.30am to 7pm, Monday to Saturday.
You can request a booking here:
https://mediq.as.me/20-with-Ravi-re-Covid-19
If you have any trouble using the form, please just email me.
On a genuinely positive note, I believe that some medical businesses, perhaps many, will not only come through this event – but will do so stronger and more effective. I am seeing many practices adopting novel practices, and diversifying, to respond to new and changed market and patient needs. Some or all of these changes are likely to remain ongoing features of medicine and there is likely to be a genuine paradigm shift in practice/patient behaviour. You can take advantage of this re-setting by observing these changed conditions and thinking how best you and your practice could respond.
I can talk with you about how you can respond and urge you to make contact if you need my support. As always, the entire MEDIQ team is here to support you.
The relief efforts in order of importance for our clients:
1. ATO Relief – PAYGW Refunds
Relief:
- January 2020 to June 2020: Tax free payments of between $10,000 to $50,000
- July 2020 to October 2020: Tax free payment of up to $50,000
Eligibility:
- Businesses that employ staff, between 1 January 2020 and 31 October 2020
Notes:
- 100% of PAYG withheld between January 2020 and June 2020 will be credited to a maximum of $50,000 for the six month period. The minimum amount an employer will be able to receive is $10,000, up to the maximum of $50,000 for this period.
- An additional payment is also being introduced in the July — October 2020 period equal to the total of the PAYG withheld refunded in the previous six months to provide a total refund of up to $50,000 per entity.
- PAYGW credits will apply on a per entity, ABN basis. Therefore, if you have two entities conducting business in your group structure each entity is eligible for PAYGW BAS credits of up to $50,000 provided that each entity has paid $50,000 in PAYGW during the period 1 January 2020 to 30 June 2020.
- Maximum total refund per entity is $100,000
- Upon lodgement of the March 2020 quarter Business Activity Statements (BAS), the ATO will automatically apply a credit to the entities Running Balance Account in the amount of the PAYG tax withheld reduction from 28 April 2020.
- The ATO has advised that where these credits result in an entity having a net refundable amount, refunds will be paid within 14 days to the entity’s nominated bank account.
- For employers with monthly Activity Statement lodgements, the March 2020 credit will be calculated at three times the rate, to cover for the January and February months.
2. Tax Payment Deferral Options
Relief:
- Deferral of up to four months the payment date for BAS amounts due (including PAYG instalments), income tax assessments, FBT assessments and excise.
- IMPORTANT: Ability to vary PAYG instalment amounts to zero for the March 2020 quarter; businesses that vary their PAYG instalment to zero can also claim a refund for any instalments made for the September 2019 and December 2019 quarters.
- Remitting any interest and penalties, incurred on or after 23 January 2020, that have been applied to outstanding tax liabilities.
- Working with affected businesses to help them pay their existing and ongoing tax liabilities by allowing them to enter into low-interest payment plans
Notes:
- We will be applying for this relief option for all eligible clients. Our view is to get the money into your bank account to ensure adequate cash flow during this period.
3. Bank Care Package
Relief:
- Deferral of principal and interest repayments for all term loans and retail loans for six months
Eligibility:
- Small business customer
- <$3m in total debt owed to credit providers
Notes:
4. SME Guarantee Scheme
Relief:
- Under the Scheme, the Federal government will guarantee 50 per cent of new small business unsecured loans issued by eligible lenders up to the value of $250,000. This effectively represents a guarantee of $125,000.
Eligibility
- Small business customer
- <$3m in total debt owed to credit providers
Notes:
- Commencing in April 2020 and loans will be made available by participating lenders until 30 September 2020
- The loans will be made under a term of 3 years with an initial 6 month repayment holiday.
- No assets will be required as security for these loans.
- These conditions apply only to new loans, not refinanced loans
- No fees will be payable on the establishment of the loans
5. Instant Asset Write Offs and Accelerated Depreciation
Relief:
- Increase in the instant asset write off threshold from $30,000 to $150,000
Eligibility
- Only applicable to assets purchased after the 12th March 2020 (but before 30 June 2020)
6. Payroll Tax
VIC:
- Full payroll tax refunds for the 2019-20 financial year to businesses with taxable wages of less than $3 million per member entity of a group.
- Refunds should start in the coming weeks
NSW:
- Waiving payroll tax for businesses with payrolls of up to $10m, for the months from April to June 2020.
- Payroll tax threshold will be raised to $1m in 2020/21
WA:
- Businesses paying payroll tax, with a payroll between $1m and $4m will receive a one-off grant of $17,500.
- Increase of the payroll tax threshold to $1m will be fast-tracked to 1 July 2020
- Businesses who pay $7.5m or less in Australian taxable wages and have been affected by COVID-19, can apply for a deferral of their 2019/20 payroll tax payment until 21 July 2020
QLD:
- Deferral of March to June payroll tax returns until the 3rd of August 2020.
ACT:
- Access to interest-free deferrals of payroll tax commencing on 1 July 2020 for all businesses up to a payroll threshold of $10m in Australian taxable wages.
TAS:
- Businesses with an annual payroll not exceeding $5m in Australian wages, can apply for a waiver of payroll tax for the three months of April, May and June 2020.
7. Land Tax Deferral
Relief:
- Option of deferring 2020 land tax payment until after 30 June 2020.
Eligibility
- Landowners due to pay 2020 land tax that have at least one non-residential property and total taxable landholdings below $1 million
