Publications - COVID-19
The latest on the introduced measures
1 May 2020
The Covid-19 pandemic has created a uniquely trying time for many businesses. While the pace seems to have eased on new measures introduce by our governments to address the impact of the pandemic, the information in relation to these measures can be difficult to navigate.
Below is a summary of our updates and some of the measures introduced that may affect you or your business.
Commercial and Residential Tenancies
There have been several important measures introduced by the State and Federal Government to address the impact of the pandemic on tenancies.
Changes to the Foreign Acquisitions and Takeovers Act 1975
Changes to the way foreign investment is reviewed in Australia came into effect on 29 March 2020.
The key changes provide that the threshold for monetary screening for proposed foreign investments is reduced to $0.00 which means all proposed foreign investment in Australia will be subject to review by the Foreign Investment Review Board (unless an exemption applies).
You can read our previous update on this at Changes to the Foreign Acquisitions and Takeovers Act 1975.
Relief for eligible Businesses
The NSW Government has announced a series of economic measures targeted to relieve and support businesses during the Pandemic. These measures include the following.
More information is available at NSW Government Businesses and Employment.
Additionally, the Australian Government is guaranteeing 50% of the value of eligible business loans to small and medium enterprises impacted by Covid-19 to a value of $250,000.00 with a six-month repayment-free period. Information is available at Supporting the Flow of Credit Fact Sheet PDF.
Support Grants for Small Businesses
Several grants are offered that may be available to affected business in this period.
JobKeeper Payment Scheme
The Federal Government has introduced the JobKeeper Payment Scheme which enables businesses impacted by the Coronavirus to access a subsidy to continue paying their employees.
Up-to-date information on the scheme can be found at Australian Government JobKeeper Payment for Employers and Employees.
Changes to the Fair Work Act
The Fair Work Act was amended on 9 April 2020 to support the JobKeeper Scheme.
The amendments include new provisions to enable employers who qualify for the JobKeeper Scheme to make “JobKeeper Enabling Directions”. This allows employers, in certain circumstances, to temporarily:
The new provisions also enable employers who qualify for the JobKeeper scheme, in certain circumstances, to make agreements with their employees to take annual leave or change their days.
Further information on these changes can be found at Fair Work JobKeeper changes to the Fair Work Act.
Tax Relief
The ATO have implemented new tax relief measures, including the following.
More information can be found at ATO COVD-19 Support for Businesses and Employers.
Energy and Gas Network relief package
Small businesses that are temporarily closed due to Covid-19 may be eligible for tariff relief under a support package organised by Energy Networks Australia. Information is available at Energy Networks - Energy network relief package announced.
Early Access to superannuation for Sole Traders
Sole Traders who have suffered a decrease in income of at least 20% as a result of the pandemic can apply to access their superannuation early, to a total value of $10,000.00. Withdrawals are tax-free. Information is available at Early Access to Superannuation Fact Sheet PDF.
Unforeseeable Circumstances and Terms of Trade
Our series of articles on how these unforeseeable circumstances may impact your terms of trade can be found at Part 1 - Snapshot, Part 2, Part 3 and Part 4 - Government Resources.
If you would like advice in relation to your own personal circumstances, please contact us. We will endeavour to respond to any queries that come through on our website as quickly as possible. Click here, or call one of our lawyers.
Below is a summary of our updates and some of the measures introduced that may affect you or your business.
Commercial and Residential Tenancies
There have been several important measures introduced by the State and Federal Government to address the impact of the pandemic on tenancies.
- The NSW Government has announced a $440 million land tax relief package going to both the commercial and residential sectors with eligible landlords to be offered a land tax concession of up to 25% of their land tax liability on relevant properties. Landlords must reduce the rent of affected tenants by at least as much as the reduction in order to be eligible. The NSW Government is expected to pass the relevant legislation and introduce the application process in early May. Information from the NSW Government is available at NSW Revenue COVID-19 and Land Tax
- There is a moratorium on evictions for Residential Tenancies in NSW, with negotiations over rent to be overseen by Fair Trading and NCAT. Our update on Residential Tenancies and the Land Tax Measures can be found here.
- The Federal government introduced a mandatory Code of Conduct for commercial leases which similarly prohibits evictions and stipulates the negotiation rental reductions to affected businesses. Our previous update on the Code is here. The Code was enabled into NSW Law by a set of regulations passed by NSW Parliament on 24 April 2020 (see our update here).
- The Australian Banking Association has introduced measures to support commercial landlords during the Covid-19 pandemic by deferring loan repayments for six months. Up-to-date information on these measures can be found at Australian Banking Association COVID-19 Support. Our previous update on the initial announcement is available here.
Changes to the Foreign Acquisitions and Takeovers Act 1975
Changes to the way foreign investment is reviewed in Australia came into effect on 29 March 2020.
The key changes provide that the threshold for monetary screening for proposed foreign investments is reduced to $0.00 which means all proposed foreign investment in Australia will be subject to review by the Foreign Investment Review Board (unless an exemption applies).
You can read our previous update on this at Changes to the Foreign Acquisitions and Takeovers Act 1975.
Relief for eligible Businesses
The NSW Government has announced a series of economic measures targeted to relieve and support businesses during the Pandemic. These measures include the following.
- Deferral of payroll tax for business with payrolls over $10 million for six months.
- Businesses with payrolls of $10 million or less will receive a three-month waiver on payroll tax.
- Deferral of gaming tax for clubs, pubs and hotels for six months, conditional on the funds being used to retain staff.
- Deferral of the parking space levy for six months.
- Fee Waivers for new licence applications or renewals for certain licences, including home building contractor or trade or specialist contractor licences.
More information is available at NSW Government Businesses and Employment.
Additionally, the Australian Government is guaranteeing 50% of the value of eligible business loans to small and medium enterprises impacted by Covid-19 to a value of $250,000.00 with a six-month repayment-free period. Information is available at Supporting the Flow of Credit Fact Sheet PDF.
Support Grants for Small Businesses
Several grants are offered that may be available to affected business in this period.
- Service NSW is providing Small Business Support grants of up to $10,000.00 for businesses who have experienced a significant decline in revenue as a result of Covid-19. Eligible businesses will be expected to provide evidence of a 75% decline in turnover compared to the same two-week period in 2019, with some exceptions applying. More information can be found at Service NSW Apply for Small Business COVID-19 Support Grant.
- City of Sydney Council are also offering Grants to Small Businesses up to $10,000.00 for businesses undertaking new projects in this period. Submissions for Round 1 have now ended with a Round 2 yet to be announced. More information about these grants can be found at City of Sydney Grants and Sponsorship Programs.
JobKeeper Payment Scheme
The Federal Government has introduced the JobKeeper Payment Scheme which enables businesses impacted by the Coronavirus to access a subsidy to continue paying their employees.
- The government will provide a fortnightly payment of $1,500.00 per eligible employee until 27 September 2020.
- Businesses with an aggregated turnover of $1 billion or less will be eligible if they are able to demonstrate a 30% reduction in turnover for the relevant period.
- Only permanent full-time or part time employees are eligible, or long-term casual employees not a permanent employee of any other employer.
- Eligible employers will be reimbursed a fixed amount of $1,500.00 per fortnight for each eligible employee and need to pay all eligible employees a minimum of $1,500.00 (before tax) to claim the payment.
- The payment is paid to the employer in arrears each month by the ATO.
Up-to-date information on the scheme can be found at Australian Government JobKeeper Payment for Employers and Employees.
Changes to the Fair Work Act
The Fair Work Act was amended on 9 April 2020 to support the JobKeeper Scheme.
The amendments include new provisions to enable employers who qualify for the JobKeeper Scheme to make “JobKeeper Enabling Directions”. This allows employers, in certain circumstances, to temporarily:
- stand down or reduce an employee’s hours or days of work;
- change an employee’s usual duties; and
- change an employee’s location of work.
The new provisions also enable employers who qualify for the JobKeeper scheme, in certain circumstances, to make agreements with their employees to take annual leave or change their days.
Further information on these changes can be found at Fair Work JobKeeper changes to the Fair Work Act.
Tax Relief
The ATO have implemented new tax relief measures, including the following.
- Temporary cash flow support to small and medium businesses and not-for-profit organisations (your aggregated annual turnover must be less than $50 million). Eligible businesses will receive between $20,000.00 to $100,000.00 delivered in credits in the activity statement system, equivalent to the amount withheld from wages paid to employees from March to June 2020.
- For the period of 12 March 2020 to 30 June 2020, the instant asset write-off threshold for each asset is increased from $30,000.00 to $150,000.00 for eligible businesses. The eligibility criteria has been expanded to cover businesses with an aggregated turnover of less than $500 million (up from $50 million).
- Acceleration of depreciation deductions on the purchase of certain new depreciable assets. The asset must be first held on or after 12 March 2020 and not be an asset which an eligible business has applied the instant asset write-off rules to.
More information can be found at ATO COVD-19 Support for Businesses and Employers.
Energy and Gas Network relief package
Small businesses that are temporarily closed due to Covid-19 may be eligible for tariff relief under a support package organised by Energy Networks Australia. Information is available at Energy Networks - Energy network relief package announced.
Early Access to superannuation for Sole Traders
Sole Traders who have suffered a decrease in income of at least 20% as a result of the pandemic can apply to access their superannuation early, to a total value of $10,000.00. Withdrawals are tax-free. Information is available at Early Access to Superannuation Fact Sheet PDF.
Unforeseeable Circumstances and Terms of Trade
Our series of articles on how these unforeseeable circumstances may impact your terms of trade can be found at Part 1 - Snapshot, Part 2, Part 3 and Part 4 - Government Resources.
If you would like advice in relation to your own personal circumstances, please contact us. We will endeavour to respond to any queries that come through on our website as quickly as possible. Click here, or call one of our lawyers.
