Dear Clients
We want to let you know that it’s business as usual at Quantum Partners & Quantum Wealth. Whilst we don’t want to be alarmist we are expecting the COVID-19 (Coronavirus) to cause enormous disruption to business and the economy in general in the short to medium term.
The purpose of this newsletter is to provide relevant information we see as necessary to assist in combating the effects of the virus. The health and personal impact, whilst significant, is not the topic of this newsletter and we assume we are all actively taking recommended steps to minimise that impact.
As a business, we are making plans to ensure our staff are setup to work from home as we expect medical and Government advice will escalate in relation to social distancing and self-isolation and as such planning for these heightened precautionary measures needs to occur now!
While the health and wellbeing of our staff is paramount we want to ensure we are able to continue to provide services to our valued clients. Our teams are equipped for web and video conferencing, if required and will continue to deliver our services via these platforms, as well as emails and telephone calls. At this stage we are not cancelling any client meetings scheduled in our office but this could change in coming days.
The coronavirus or COVID-19 presents a significant threat not only to human health but also to business. For many businesses, likely moves by Federal and State governments to contain the public health risk will no doubt result in significant fall in demand for your products or services, labour shortages and supply disruptions.
As part of a comprehensive risk management strategy there are a range of actions you should consider taking now to prepare your business for COVID-19, to place it in the best possible position to not only navigate through the crisis but to also be better prepared to take advantage of the recovery.
For those clients not in business, we still encourage you to continue reading as you will know family or friends in business or you may wish to ask your own employer to consider some of these measures now.
- Keep up to date with official information on COVID-19 and any directions public health authorities may issue
- Update your financial statements
- List possible impacts on your business of COVID-19, estimate the financial impact and develop mitigation strategies
- Perform a financial health check on your business
- Re-do your budgets with new assumptions
- Act now to improve cash flow
- Increase online sales
- Put in place a contingency plan
- Talk to key suppliers
- Identify employees with critical skills for your business and make sure they can continue working or can be replaced
- Measure, measure, measure
- Do a reality check on your business
- If you find yourself in financial difficulty, seek professional advice early
We also note that for those that face financial difficulty and have either business and/or home loans, lenders will implement special hardship provisions to help alleviate the inevitable financial difficulties at this time. These measures may include:
• deferral of payments for home loan, cards and vehicle finance products
• reduction in credit card interest rates for an agreed period
• a range of emergency assistance measures to support clients with urgent needs
• loan restructuring and reassessment of loan terms.
We would encourage you to reach out to your mortgage broker or bank relationship manager as soon as possible if you are unable to meet any terms of your financial obligations under any bank facility. Here is a link to Australian Banking Association hardship information: CLICK HERE
Additionally the ATO have established a COVID-19 hotline for emergency support. More info here and the info line is 1800 806 218 to discuss relief options based on your needs and circumstances.
The ATO have already put in place the following policies to provide assistance to taxpayers:
Payment deferrals – ATO
If you or your business has been impacted by the COVID-19 outbreak, we can work with you to defer some payments and vary instalments you have due, such as income tax, activity statement (including PAYG instalments), FBT and excise payments by up to four months.
Pay as you go instalments – ATO
If you are a quarterly pay as you go (PAYG) instalments payer you can vary your PAYG instalments on your activity statement for the March 2020 quarter. You can do this by lodging a revised activity statement before your instalment is due and before you lodge your income tax return for the year. Businesses that vary their PAYG instalment rate or amount can also claim a refund for any instalments made for the September 2019 and December 2019 quarters.
Remitting interest and penalties – ATO
Where your business is affected by COVID-19, we will consider remitting interest and penalties applied to tax liabilities incurred after 23 January 2020.
Low interest payment plans – ATO
If your business has been affected by COVID-19 and you need help to pay your existing and ongoing tax liabilities, contact us to discuss entering a low interest payment plan.
Monthly GST credits – ATO
Businesses on a quarterly reporting cycle may elect to change their GST reporting and payment to monthly, to get quicker access to GST refunds you are entitled to. You can only change from the start of a quarter, so a change now will take effect from 1 April 2020.
Changing your GST reporting cycle to monthly doesn’t mean you have to change your PAYG withholding reporting cycle. You can manage this by specifying the roles you are changing.
Once you choose to report and pay GST monthly, you must keep reporting monthly for 12 months before you can elect to revert to quarterly reporting.
Super guarantee payments – ATO
Employers still need to meet super guarantee obligations for their employees.
Tax Lodgement deadlines – ATO
While nothing has been officially announced as yet we are expecting some relief in relation to income tax and BAS lodgement deadlines for those taxpayers that are currently up to date. We will advise in due course.
NSW Government Stimulus Package
As part of new measures, $450 million has been allocated to waive payroll tax for businesses with payrolls of up to $10 million for three months.
The State Government said these businesses would not have to pay the tax for the rest of this financial year.
The next round of payroll tax cuts has also been brought forward to raise the threshold limit to $1 million for the next financial year.
Hopefully you have already read our stimulus package newsletter emailed to you on Thursday 12 March 2020. We will be sending updates on this as more information becomes available.
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