Further to the Governments initial stimulus package announced last week, over the weekend, the Government has announced an additional support package estimated at costing $66 Billion.  The packages are targeted at four areas of need including:

Casuals and sole traders

Casual labour and sole traders who have been affected by the economic downturn will be able to claim “coronavirus supplement” of $550 a fortnight for the next six months. This is on top of other benefits already announced. So if they are receiving payments through Jobseeker (formerly known as Newstart), they can claim both.

Sole traders and casual workers who are currently earning less than $1,075 a fortnight will be eligible to receive the full supplement.

Further information can be found here

Sole traders or casual workers who have had their income or hours reduced by 20 per cent or more as a result of coronavirus will also be able to access to up to $10,000 of their superannuation tax-free. Please refer to households section for full details.

Households

For households ineligible to receive the coronavirus supplement, they may still be able to claim an additional $750 stimulus payment. The payment will be made automatically from July 13 to about 5 million Australians, including those receiving the age pension, a carers allowance or family tax benefit and Commonwealth senior card holders. This is in addition to a separate $750 stimulus payment announced earlier this month which is payable around 31 March.

Further information can be found here

There is a relaxation to the existing Superannuation early access provisions, allowing access to up to $10,000 in super savings in both this financial year and next. Eligibility requires any one or more of the following;

      • unemployment; or eligibility to receive a job seeker payment, youth allowance for jobseekers, parenting payment (which includes the single and partnered payments), special benefit or farm household allowance; or
      • on or after 1 January 2020: redundancy; or
      • a reduction to working hours of 20 per cent or more; or
      • for sole traders — business was suspended or there was a reduction in turnover of 20 per cent or more over the last six months.

Superannuation fund members will be able to apply online through myGov. The ATO will provide a copy of their favourable determination to their super fund which will make the payment directly. The ATO are yet to advise the procedure for SMSFs.

Withdrawals will be tax free and will not affect Centrelink or DVA payments.

Only one application will be allowed in each year financial year. If the full $10,000 is not applied for this year, the member cannot subsequently apply for the balance remaining this year but may apply for the full $10,000 again next financial year.

Further information can be found here

Self funded retirees and Government Income support recipients

For retirees drawing income from Retirement income streams, the pension minimum drawdown percentages for this year financial and next will be halved. This is similar to the initiative utilised during the GFC. The revised minimum pension for those under 65 will be 2% and for those aged 65 to 74 will be 2.5%.

The deeming rates used to assess the incomes test for those on Centrelink benefits have been temporarily reduced by 0.25%. From the beginning of May, the lower deeming rate on assets up to $51,800 for singles or $86,200 for couples will be 0.25 per cent and the upper deeming rate will be 2.25 per cent.

It is estimated that age pensioners would receive on average an additional $219 per year on top of the additional savings made when deeming rates were cut last month.

Further information can be found here

Employers who want to keep staff

Not-for-profits and small businesses with a turnover under $50 million will receive a tax-free cash payment of up to $100,000 to help them retain staff and continue operating.

The Government expects 690,000 businesses employing 7.8 million people and 30,000 not-for-profits will be eligible for measures in the stimulus package.

Further information can be found here

All these measures are expected to be operational by mid-April but will be subject to the passage of legislation through the parliament.

Should you have any questions in relation to how these stimulus packages may affect your situation, please do not hesitate to contact us.