On Monday 26th July, applications for the JobSaver scheme opened for NSW based businesses who have been impacted by the latest covid-19 lockdown. Applicants who are successful will receive 40 percent of their weekly payroll, at a minimum of $1,500 and a maximum of $10,000 per week, as long as they maintain their full-time, part-time and long-term casual staffing level as of 13 July.
Non-employing businesses, such as sole traders, can expect $1,000 payments per week.
Payments distributed to businesses under the JobSaver scheme will be paid on a fortnightly basis by Service NSW and will be backdated to 18 July 2021 which was week 4 of the Greater Sydney lockdown. Businesses who suffered a decline in turnover for the first three weeks of restrictions will be covered by the 2021 Covid-19 Business Grant.
To be eligible, businesses must have a turnover of between $75,000 and $50 million for the financial year that ended 30th June 2020, and demonstrate a decline in turnover of 30 percent or more over a minimum two-week period from the start of the Greater Sydney lockdown on 26th June, compared to the same period in 2019.
Service NSW has admitted that some businesses will not meet the eligibility criteria but may still be eligible for JobSaver.
This means that new businesses, or those who were operating under unusual trading conditions in 2019, are encouraged to contact Service NSW directly to ascertain their eligibility.
In line with the business grant program, businesses in highly impacted industries will be required to provide details of their qualified accountant, registered tax agent or registered BAS agent for compliance checking, while businesses outside the highly impacted industries list will be required to produce a letter from their practitioner that verifies their decline in turnover.
Letters used for the business grant program can be resubmitted when applying for JobSaver.
The 40 percent weekly payroll calculation will be determined by referring to item W1 in the most recent BAS lodged with the ATO prior to 26 June 2021 for the 2020-21 financial year. Businesses will then need to deduct any amounts withheld on behalf of contractors under voluntary agreements.
According to Service NSW, the amount must then need to be divided by the number of days in the BAS period and multiplied by 7 to calculate the weekly payroll amount.
Businesses that do not submit a BAS or have no W1 amount will be required to use the ATO’s definition of W1 to calculate their payroll for April or May before dividing it by the number of days in the month and multiplying it by 7.
Businesses who have an annual turnover between $30,000 and $75,000 will be eligible for a fortnightly payment of $1,500 if they have experienced a decline in turnover of 30 pe cent or more since the start of the lockdown.
They must not have applied for either the 2021 Covid-19 Business Grant, or the JobSaver scheme.
The grant will be paid in arrears, with the first payment backdated to 26th June 2021.
Employees can receive the Commonwealth Covid-19 Disaster Payments even if their employer is receiving JobSaver or the micro business grant.
Sole traders or non-employing businesses will not be eligible for additional assistance if they are currently receiving the Covid-19 Disaster Payments.
Applications for both JobSaver and the Micro-Business Grant opened on Monday 26th July and will close at 11:59pm on Monday 18th October.
How Business Owners Can Remain Proactive During Lockdown
It is very common for small business owners to talk about how they would love to have some time to work “on their business” and not “in their business”.
Although lockdowns can be frustrating and result in a large number of financial challenges, small business owners should aspire to use the time spent in lockdown to develop a plan on how they can grow their business and make it better and more efficient.
Here are some tips for small business owners who are wanting to remain productive during lockdown.
- Prepare a business plan or revise your original one
- Prepare a marketing plan
- Get your bookkeeping and tax returns up to date
- Research your market and explore new opportunities for growth
- Experiment and research new technology for your business that may bring efficiencies to your operations
- Have your wills and succession plans prepared
- Check that your personal and business insurances are current and that you are adequately covered
- Do a health check on your loans. Call the bank and enquire if they can better your interest rate. Banks prey on complacency, so it’s always worthwhile asking the question and make it clear you plan to shop around
The team at C&D Restructure and Taxation Advisory are here to help. As part of the Vault Group we can offer the full suite of financial products and advice to help you navigate the business landscape. Schedule a meeting here via Calendly or give us a call on 07 36086800.
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