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Government grants to help your business during the COVID-19 pandemic

Find out how the government is helping businesses across Australia affected by COVID-19 with grants, tax refunds and waivers.

Bria Horne
Bria Horne

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Many Australian SMEs are fighting to keep heads above water as the pandemic plays out. In response, the government is issuing a series of cash grants, refunds and waivers to eligible businesses affected by COVID-19. If your business could benefit from a cash flow injection that you don't have to repay, see this guide for more details.

What's in this guide?

What government grants are available to small businesses affected by COVID-19?

On 22 March 2020, the Australian government announced a $66 billion stimulus package to support the Australian economy through the COVID-19 outbreak. This is in addition to the $17.6 billion package announced on 12 March.

As part of the new package, up to 700,000 Australian businesses and 30,000 not-for-profits will be eligible for grants. These tax-free grants are available from $20,000 to $100,000 and are to be issued to eligible businesses when they lodge their activity statements (BAS or IAS). The grants will consist of what's referred to as "initial cash flow boosts" and "additional cash flow boosts". These cash flow boosts are set to benefit businesses employing around 7.8 million people across Australia.

Initial cash flow boosts

The initial cash flow boosts will be issued in two or four instalments. This will depend on whether you pay tax quarterly (x2 instalments) or monthly (x4 instalments). The total of this two or four instalment grant will be a minimum of $10,000 and a maximum of $50,000 per business. Eligible businesses will receive these cash flow boosts from 28 April 2020.

Additional cash flow boosts

Businesses that received the initial cash flow boosts will receive additional cash flow boosts for the periods June to September 2020. These will be equal to the total amount of initial cash flow boosts your business received and will also be delivered in either two or four instalments, depending on your business's reporting period.

How do I know that my business is eligible?

For your business to be eligible it must have:

  • Held an ABN on 12 March 2020 and is still active
  • An annual turnover of less than $50 million
  • Made eligible payments you are required to withhold from (even if the amount you need to withhold is zero)

Eligible payments include:

  • Salary and wages
  • Director fees
  • Eligible retirement or termination payments
  • Compensation payments
  • Voluntary withholding from payments to contractors*

*Ref: ato.gov.au

How much does my business qualify for?

The amount your business will qualify for will depend on the amount of tax your business pays on employee wages. Eligible businesses will receive a credit equal to 100% the amount of tax withheld on employees' wages up to a maximum of $50,000.

How do I receive a COVID-19 government business grant?

You do not need to apply for these grants, you simply need to lodge your activity statement. If your business is eligible, the cash flow assistance will be delivered as credits in the activity statement system from the government's announced date of 28 April 2020. Lodging your activity statement early will not see you receive funds any earlier than this date.

Colleagues in the office practicing alternative greeting for safety and protection during COVID-19

Other government grants available to businesses will vary by state. See what grants, refunds and waivers are available in your state below.

Australian Capital Territory: COVID-19 government grants available to businesses

If your business is based in the ACT you can expect government grants, refunds and waivers in response to COVID-19 such as:

  • A credit of $2,622 to you commercial rates bill
  • A $750 rebate through your next electricity bill
  • Other affected industries will receive a six-month waiver on payroll tax
  • Your company taxi and rideshare fees waived
  • Food and liquor licence fees waived
  • Grants for clubs to retain casual staff

New South Wales: Government grants available to businesses affected by COVID-19

If your business is based in NSW you can expect grants, refunds and waivers such as:

  • $1.6 billion to provide tax relief for businesses to keep people in jobs
  • Waiving of payroll tax if your business pays up to $10 million in wages until 30 June 2020

Victoria: Grants available to businesses affected by COVID-19

The Victorian government announced a $1.7 billion stimulus package on 21 March 2020 to support workers and small businesses. If your business is based in Victoria and is struggling as a result of COVID-19 you can expect grants, refunds and waivers such as:

  • Effective as of 21 March 2020 businesses with payroll tax under $3 million are eligible to a full payroll tax refund for the financial year 2019/2020
  • If your business rents space in a government building, you can apply for rent relief
  • Businesses in hospitality, tourism, arts and retail are eligible for grants from Victoria's $500 million Business Support Fund
  • Food and liquor licence fees waived and a reimbursement of all those paid in 2020

Queensland: Grants available to businesses affected by coronavirus

If your business is based in Queensland you can expect grants, refunds and waivers such as:

  • A two-month refund of payroll tax
  • An additional three-month payroll tax waiver
  • Grants to support the fishing industry, a temporary waiver of fishing boat licence fees and quota fees for tropical rock lobster and coral trout
  • Liquor licence fee waivers
  • Rebates for marina charges

Northern Territory: COVID-19 grants available to businesses

If your business is based in the Northern Territory and has been affected by COVID-19 you may qualify for these grants:

The Business Improvement Grant – $20 million
  • A $10,000 grant to all eligible businesses
  • An additional $10,000 if you spend $10,000 of your own money on business upgrades (e.g. buying new equipment or fit-outs)
The Business Structural Adjustment package – $5 million
  • Grants assisting businesses that need to physically adjust venue space to abide by the 100-person rule
  • Grants supporting businesses that need to establish or upgrade their online presence to respond to an increased demand for takeaways and/or deliveries
The Immediate Work Grant – $5 million
  • Grants for not-for-profits and community organisations of up to $100,000 to engage local businesses to carry out repairs, renovations and upgrades to their properties and facilities
Small Business Survival Fund – $50 million
  • Grants for keeping businesses afloat

Northern Territory businesses can also expect:

  • A suspension of government fees and charges until 1 July 2021
  • Payroll tax exemption for hiring employees has been extended to 30 June 2021

Western Australia: Grants available to businesses affected by coronavirus

Businesses based in Western Australia affected by COVID-19 can expect:

  • If your business pays annual taxable wages of more than $1 million and up to $4 million, you are eligible for a one-off grant of $17,500
  • If your business pays less than $7.5 million in taxable wages until 21 July 2020 payroll tax will be waived

Tasmania: Grants available to businesses affected by COVID-19

Businesses based in Tasmania that are affected by COVID-19 can expect:

  • $2.1 million worth of one-off $5,000 grants for businesses that hire an apprentice or trainee
  • From 1 April 2020 Tasmania will introduce a youth employment payroll tax rebate to encourage businesses to employ young people
  • If your businesses is in the hospitality, tourism or seafood sector it will not be required to pay the state payroll tax for the last four months of the 2019/20 financial year
  • If you have an annual turnover of less than $5 million, you can apply to have payroll taxes waived for the three months from March to June 2020

JobKeeper stimulus for employers affected by COVID-19

On 30 March 2020 the government announced a new $130 billion stimulus package that gives employers a $1,500 subsidy per fortnight for each eligible member of staff that they keep on payroll during the pandemic. This money is intended to encourage businesses, even if they have been forced to close down for the duration of the pandemic, to keep employees on their books.

To find out everything you need to know about the JobKeeper's stimulus package, click here.

Remember: While a government grant may help your business, it may not be enough to keep it afloat. There are other relief measures and business loan options available to businesses during the outbreak that could be of further assistance.

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