COVID-19 Stimulus Package and Franchise Eligibility
The Australian government was quick to announce a Stimulus Package in response to the impact COVID-19 has had on Australia’s small business sector. However with all of the packages, schemes and boosts available, it can be tricky to understand exactly what your business and its staff are eligible to receive. So here a breakdown of what may be available to your franchise business under the Coronavirus Stimulus Package.
The package is worth a whopping $17.6 billion and is designed to instil confidence in the small business owners of Australia, encouraging them to continue to support and grow their businesses. With a focus on relieving cash flow concerns to allow operators to continue paying rent, bills and their staff, the package offers relief of up to $100,000.
The Cash Flow Boost is potentially the most important offering for SME’s, and is available to those who had an ABN registered prior to 12 March 2020 and an aggregated annual turnover of under $50 million. The amount your franchise is eligible for is determined automatically by the ATO based on your previous turnover, and will be available from 28 April.
Businesses do not need to complete any forms, they simply need to lodge their business activity statements to receive the tax-free boosts. If you want further information on whether your franchise is eligible and how much you will receive, you can find it on The Treasury’s Fact Sheet.
Another much anticipated element of the Stimulus Package is the JobKeeper Payment scheme. This is designed to help employers keep their staff on the books, providing fortnightly assistance of $1,500 before tax for each employee. Whilst it’s execution has come under scrutiny, the scheme does offer genuine assistance to businesses experiencing hardship. The government is eager to keep people working in order to support the broader economy and maintain consumer spending.
To be eligible to receive JobKeeper payments, the business must have an aggregated turnover of less than $1 billion, and have seen a drop is turnover of 30% or more. For those earning over the threshold, the drop is business must be 50% or more. To understand if your franchise business is eligible you can find the full requirements here.
Finally, the government has announced a number of other projects designed to help support Australian’s through this difficult time, some of which may be applicable to your franchise business. Their Instant Asset Write-Off Scheme has been extended until the end of 2020, and the asset value has been increased to $150,000. Additionally, for small businesses with 20 or less full-time workers, wage subsidies are available for those taking part in an apprenticeship or trainee program.