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Image of a business owner writing in a notebook with the caption 'Coronavirus support for sole traders. Discover which coronavirus packages may apply to you'

Summary of stimulus packages for sole traders

Last updated: 23 July 2020

If you’re operating your business as a sole trader, and unsure which of the coronavirus (COVID-19) stimulus/relief measures you may be eligible for you, here is a recap.

Please note: Eligibility criteria may apply and we strongly recommend that you speak to your accountant/tax professional, if you haven’t already, to discuss which of these packages could be best for your business.

JobKeeper Payment

If you’re a sole trader and your business revenue has been affected by the pandemic, you may be eligible for the JobKeeper Payment. To apply, you‘ll need to provide:

  • your Australian Business Number (ABN)
  • details of the nominated individual to receive the payment including their tax file number (TFN)
  • a declaration of your continued eligibility for the payment.

For more information, read our JobKeeper Payment: key questions answered and JobKeeper: new phase details articles.

To register your interest in the JobKeeper Payment, or to find out more, visit the Australian Taxation Office (ATO) website.

Please note: If you are receiving a JobKeeper Payment you are ineligible to also receive the JobSeeker Payment. Speak to your accountant or tax professional to discuss which of these packages would be right for you.

Expanded JobSeeker Payment

The eligibility to the JobSeeker Payment has been expanded to include sole traders who meet the income test for this benefit. The asset test and waiting periods for these payments have been waived, however there is also an income test for partners which must be met (this was increased from $48,000 to $79,762 on 30 March 2020).

Recipients of the JobSeeker Payment will also receive a coronavirus supplement of $550 per fortnight until 27 September 2020. After this date, the coronavirus supplement will be reduced to $250 per fortnight. For more information, read our JobSeeker: new phase details article.

To apply for the JobSeeker Payment, visit the Services Australia website.

Early access to superannuation

If your working hours or income is reduced by 20 per cent or more due to the current disruption, you can apply for early access to your super and make a tax free withdrawal of $10,000 this financial year and a further $10,000 next financial year.

You can apply via the myGov website.

Greater leniency for insolvency and bankruptcy

If you’re facing insolvency or bankruptcy as a result of the pandemic, the threshold at which a creditor can take action against a small business has increased from $2,000 to $20,000. The mandatory response time has also increased from 21 days to six months.

Relief for certain tax obligations

The ATO can provide relief from certain tax obligations for eligible businesses, including payment deferrals. Read the ATO's information on COVID-19, call them on 1800 806 218 or speak to your tax professional so that they can work with you to find a solution.

Banking deferral and relief

You can defer repayments on small business loans for six months as part of a new scheme announced by the Australian Banking Association. For assistance from your bank for other financial obligations, such as a mortgage or personal loan, contact your bank’s financial hardship team.

Electricity credit and no power or water disconnections

The State Government will provide a one-off $2,500 credit on electricity bills for small businesses that consume less than 50MWh per annum.

Power and water disconnections will also not occur and interest will not be charged on deferred payments until 30 September for small businesses facing financial difficulty due to the pandemic. Please note: This applies to Synergy and Horizon Power customers.

Waiving of licence fees and deferral of taxes and duties

The State Government is waiving a range of business licences, including those for building services, plumbers and electricians.

If your business is impacted by the pandemic, you can also apply for interest free payment arrangements and for late payment penalties to be waived for a range of taxes and duties, including transfer duty, landholder duty or land tax.

Moratorium on evictions

National Cabinet agreed to a temporary moratorium on evictions over the next six months for commercial and residential tenancies in financial distress who are unable to meet their commitments due to the impact of coronavirus. Commercial tenants, landlords and financial institutions are encouraged to work together to find a way through this period to ensure businesses can hibernate through this difficult time. Read our new commercial tenancy legislative changes overview for more information.

SME Guarantee Scheme

Phase 1: The Australian Government will provide a guarantee of 50 per cent to small and medium enterprise (SME) lenders for new unsecured loans to be used for working capital for small to medium businesses, so you can access additional funding to help support them through the upcoming months. Under this first phase, businesses can borrow up to $250,000 for a period of three years.

Phase 2: From 1 October 2020, the second phase of the SME Guarantee Scheme will allow businesses to borrow up to $1 million for a term of up to five years. The scheme will also be expanded to allow businesses to fund a wider range of investments. 

Instant asset write-off

The instant asset write-off threshold has been increased to $150,000 for new and second-hand assets purchased between 12 March and 31 December 2020. Read the instant asset write-off explained to find out more about this initiative and if it would be of benefit to your business. Claiming the instant asset write-off can be done via your business tax return.

Accelerated depreciation for investments

If you purchase new business assets between 12 March and 30 June 2020, you will be eligible to deduct an additional 50 per cent of the asset cost. Claiming accelerated depreciation can be done via your business tax return.

More information

Read our update on JobKeeper and JobSeeker: new phase details for more information on the next stage of these initiatives.

Visit smallbusiness.wa.gov.au/coronavirus for more information on how to manage disruption to your business as a result of the COVID-19 pandemic

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