Your Financial Guide April Newsletter
Hello and let’s hope April 2020 is the start of our lives and work improving……and things will improve. It’s hard to find the words to describe the last 4 weeks. I just wish everyone is healthy and coping with the stress.
Many of our family, friends and
clients are hurting financially and the emotional anxiety is high. We have
some great articles on how to find normality in these
We have also included links to financial assistance for small businesses as well as individuals (note these may change and there will be more in the future).
INVESTMENT AND MARKET UPDATE
- Blue chip diversified Australian and Global share prices will recover over time.
- Credit spreads (of high yield bond and fixed income markets) were at serious risk a week or so ago but appears to have liquidity after a USD $2t injection.
- Global Government stimulus is being announced weekly to help support and rebuild economies.
- China’s commercial and social system is now getting back to normal post COVID 19 and so will other countries, over time.
- Australia is expected to experience a recession. Proportionate government stimulous, we hope will bring a recovery sooner than later. Remember equity markets are always forward looking, sharemarket prices fall and recover in ahead of these measurable periods.
I have included a link to a
video of Warren Buffett on long term investing.
Over the next 2 weeks we will intend to talk to all our clients and discuss their individual portfolios and what we are doing to find opportunities with the recovery.
The advisers at Kelly Wealth are happy to help individuals decipher these rules, give us a call if you need help.
GOVERNMENT ASSISTANCE FOR SMALL BUSINESS
This package will provide a flat minimum payment of $1,500 per employee per fortnight over the next 6 months to businesses affected by coronavirus COVID-19.
- Employers will receive $1,500 per employee per fortnight, irrespective of what the employee’s earning are
- For employees who earn less than $1,500 in a particular fortnight, the employer will need to top up to $1,500
- Employers must notify eligible employees that they are receiving the JobKeeper Payment
- Employees with multiple jobs can only benefit from one JobKeeper Payment
- Employees are subject to PAYG tax on their earnings including the component supported by the JobKeeper Payment
- Superannuation guarantee obligations will continue except that it won’t apply to any top-up for those employees who were earning less than $1,500 per fortnight
Full-time, part-time employees and casuals who have been with their employers for at least 12 months are all eligible for this payment. This is subject to them being at least 16 years of age. It will also be available New Zealanders in Australia on 444 Visas.
Only currently engaged employees, including those stood down, qualify for the payment. If employees have been retrenched, they would need to be reinstated to qualify for the benefit.
For most employers, Single Touch Payroll data will enable the ATO to pre-populate employee details.
Sole-traders without employees that meet the turnover tests will also be eligible.
Business eligibility subject to “required turnover decline”
Businesses with turnover of up to $1 billion that have seen their revenue drop by 30% and businesses with a turnover of more than $1 billion that have seen their revenue drop by 50%, due to coronavirus are eligible to register with the ATO for the JobKeeper subsidy.
The turnover decline will require that turnover of the current period be compared with a comparable period of the previous year (of at least one-month duration).
Not-for-Profit organisations (including charities) also qualify. However, financial institutions that are subject to the Major Bank Levy will not be eligible.
The package commences from today and applies to employees registered with their employer from 1 March 2020. The first payment will be made via the ATO from 1 May and will be backdated to today (30 March 2020).
does this work with Jobseeker?
The Prime Minister and Treasurer were clear that people can either access the Jobseeker payment or the Jobkeeper payment, not both. It was also flagged that the partner income threshold for people looking to access the Jobseeker payment will be lifted to nearly $80k ($79,762), allowing more people to access support in the future.
SMALL BUSINSESS EMPLOYEE GUIDE
The spread of the novel
coronavirus (COVID-19) will be the dominating news topic of 2020 so far. The
Australian Government on the advice of health officials have implemented a
range of changes to ordinary life in order to try to slow the outbreak of
COVID-19 and stay ahead of the curve.
It is therefore important for employers to now adequately to respond as COVID-19 continues to develop both in Australia and globally.
To assist I have included a link to an CCIQ information booklet in a way to address the key safety and employment issues, outlining the base position and then additional questions that may arise. Click here
SMALL BUSINESS GOVERNMENT LOAN
The criteria to access the Queensland Government loan up to $250,000 was released this morning. To be eligible, you must:
- Have one or more full-time employee in Queensland.
- Have operated a business since 1 July 2017.
- Have suffered a loss of income as a result of Covid-19.
- Be a sole trader, partnership, trust, private or public company.
- Loan terms is 10 years.
- Repayment and interest free for the first year.
- Interest will apply only from the second year at 2.5%.
- Payments will be interest-only for years 2 and 3.
- Loans up to $100,000 will require no loan security.
Loans over $100,000 and up to $250,000 to be secured by a General Security Agreement.
To apply, go to The Queensland Rural and Industry Development Authority application page at: https://lnkd.in/fRyd5kz
BUSINESS TAX INCENTIVES AND BANK LENDING EXTENSIONS
Some of the small business tax incentives we previously talked about this in our last update. I have inluded a link to it below in case you missed it.
ASSISTANCE FOR INDIVIDUALS AND SOLE TRADERS IMPACTED BY THE COVDID 19
RESTRICTIONS – “Jobseeker”
To apply for government assistance i have included the steps below on how;
Jobseeker: (note you can’t be paid under both JobKeeper and Job seeker)
Step 1 ; Apply for a My Gov account. mygov sign in https://my.gov.au/mygov
Step 2; Register for Job seeker from. MYGOV register https://my.gov.au/EnrolService/register.jsp?login=true&Return=/
Step 3, Complete the application; I have included some information to help you (and accessing super).