The Alternative Tests
Under the JobKeeper rules, special discretionary powers were given to the Commissioner of Taxation to determine alternative tests for classes of taxpayers where the basic test couldn’t be used because there was no appropriate relevant comparison period.
These alternative tests have now been determined. The alternative tests are only relevant if the basic test cannot be met.
As a result of the stimulus measures announced over the last month or so, many businesses will start receiving payments from the Federal or State Government. It is important that these payments are accounted for correctly.
Cash flow boost
The COVID-19 cash flow boost for businesses are tax free and not subject to GST. These should be recognised separately in your accounting software.
We suggest creating an ‘Other income’ account narrated ‘Cash-flow boost’. This account should be set up as ‘BAS Excluded’ or ‘Non-reportable’. This will ensure that they are not reported as income.
Emergency cash grants for small businesses in SA
Last week the State Government announced $10,000 emergency cash grants for small businesses that have been adversely impacted by COVID-19.
The cash grant is a one-off grant for small businesses and not-for-profits to help them with ongoing or outstanding businesses costs.
JobKeeper Payment
The JobKeeper Payment was announced by the Federal Government on Monday 30 March 2020. Since then there was much speculation as to how this payment was going to work, who would eligible, and when would the payments start.
The JobKeeper Payment is a payment available to eligible businesses to enable, or assist them, to retain employees where they have been adversely impacted by COVID-19. For eligible businesses with eligible employees, they will receive $1,500 per employee per fortnight as a wage subsidy or to reimburse payments made to employees.
The rules which underpin this payment were finalised and released on Thursday 9 April.
The South Australia COVID-19 Emergency Response Bill 2020 (“Bill”) was enacted on Thursday 9 April 2020 in response to the National Cabinet’s Mandatory Code of Conduct.
The purpose of the Mandatory Code of Conduct document was to agree in principle a consistent way for the treatment of commercial leases across the country, leaving it to each state to independently legislate these principles.
A summary of the application of the code are as follows:
