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  • Delivery of the cash flow boosts

    Cash flow boosts will be delivered initially when you lodge your activity statements for each monthly or quarterly period from March to June 2020, and additionally from June to September 2020.

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    Initial cash flow boost

    Timing

    The initial cash flow boosts will be delivered as credits in the activity statement system when you lodge your activity statements for each monthly or quarterly period from March to June 2020.

    When you lodge your June 2020 activity statement you will receive both initial and additional cash flow boosts as credits.

    Amount

    Your initial cash flow boost amount is based on the amount of your PAYG withholding.

    Eligible businesses that withhold tax on their employees' salary and wages will receive a credit equal to 100% of the amount withheld, with the following exceptions:

    • Monthly lodgers will receive a credit for March 2020 which is 300% of their withholding for that month – this will provide an approximate equivalent to lodgers reporting quarterly.
    • Eligible businesses will receive a minimum of $10,000 across March to June 2020, even if their total withholding is less than $10,000.
    • Total cash flow boosts for March to June 2020 cannot exceed $50,000.

    If you receive the minimum credit of $10,000 you will not be eligible to receive any more cash flow boosts until your PAYG withholding exceeds $10,000 over the eligibility periods.

    Example 1 – PAYG is less than $10,000 in first period

    Tim owns and runs a small paper delivery business in Melbourne and employs two casual employees who each earn $10,000 per year. In the March 2020 quarterly activity statement, Tim reports:

    • wages paid at W1
    • $0 at W2, because his employees are under the tax-free threshold.

    The March 2020 quarter is the first period Tim is eligible for an initial cash flow boost. His withholding of $0 is less than $10,000. This means Tim's initial cash flow boost will be the minimum amount of $10,000.

    Tim will not receive any further initial cash flow boosts unless his withholding in the June 2020 quarter is greater than $10,000. However, Tim may receive the additional boosts when he lodges his June and September activity statements (see quarterly reporting example).

    End of example

     

    Example 2 – Total cash flow boosts reaches maximum limit of $50,000

    Sarah owns and runs a building business in South Australia. She employs eight construction workers who each earn $89,730 per year. In the activity statements for March, April, May and June 2020, Sarah reports:

    • wages paid at W1
    • withholding of $15,008 at W2.

    As her March 2020 withholding is greater than $10,000, Sarah’s initial cash flow boost is $45,024 (3 × $15,008).

    For April 2020, Sarah's withholding is $15,008. However, there is only $4,976 of the initial cash flow boost remaining before she reaches the maximum limit of $50,000. This means for April 2020 she will receive a further initial cash flow boost of $4,976.

    Sarah will not receive any further initial cash flow boosts after she has reached the $50,000 limit.

    End of example

    Key dates

    If you lodge:

    • quarterly – you will be eligible to receive the credit for   
      • quarter 3 (January, February and March 2020) – lodgment due date is 28 April 2020 (see note)
      • quarter 4 (April, May and June 2020) – lodgment due date 28 July 2020
    • monthly – you will be eligible to receive the credit for   
      • March 2020 – lodgment due date 21 April 2020
      • April 2020 – lodgment due date 21 May 2020
      • May 2020 – lodgment due date 22 June 2020
      • June 2020 – lodgment due date 21 July 2020.

    Note: If you have been affected by the 2019–20 bushfires, automatic lodgment deferrals are in place until 28 May 2020.

    Additional cash flow boost

    Timing

    If you received initial cash flow boosts, you will automatically receive additional cash flow boosts when you lodge your activity statements for each monthly or quarterly period from June to September 2020. These will be delivered in either two or four instalments, depending on your reporting period.

    If you haven't made payments to employees subject to withholding from June onwards, report '0' for PAYG withholding when lodging your activity statement to ensure your business still receives the additional cash flow boost. It's important you don't cancel your PAYG withholding registration until you have received the additional cash flow boost.

    Amounts

    The amounts will be equal to the total amount of initial cash flow boosts received and split evenly over the lodgments for the periods June 2020 to September 2020.

    If you lodge:

    • quarterly – you will receive 50% of your total initial cash flow boosts for each activity statement
    • monthly – you will receive 25% of your total initial cash flow boosts for each activity statement.

    Both the initial and the additional cash flow boosts will be credited when you lodge your June 2020 activity statement unless you already received the maximum $50,000 of initial cash flow boosts from earlier periods.

    Example 1 – quarterly activity statement

    Tim received initial cash flow boost of $10,000. When Tim lodges his June and September 2020 quarterly activity statements, he will receive additional cash flow boosts as follows:

    • $5,000 for quarter ended June 2020
    • $5,000 for quarter ended September 2020.
    End of example

     

    Example 2 – monthly activity statement

    Sarah received the maximum initial cash flow boosts of $50,000. When Sarah lodges her June to September 2020 activity statements she will receive additional cash flow boots as follows:

    • June 2020 – $12,500
    • July 2020 – $12,500
    • August 2020 – $12,500
    • September 2020 – $12,500.
    End of example

     

    Example 3 – withholding declining during the coronavirus situation

    Mary has employees and withholds from their wages. She is eligible to receive the cash flow boost. When she lodges her quarterly activity statements she reports withholding as follows:

    • March 2020 – $12,000
    • June 2020 – $2,000
    • September 2020 – $0.

    When she lodges her activity statements, Mary will receive cash flow boost credits of:

    • March 2020 – $12,000 from the initial cash flow boost
    • June 2020 – $2,000 from the initial cash flow boost plus $7,000 from the additional cash flow boost
    • September 2020 – $7,000 from the additional cash flow boost.
    End of example

    Key dates

    If you lodge:

    • quarterly – you will be eligible to receive the credit for    
      • quarter 4 (April, May and June 2020) – lodgment due date is 28 July 2020
      • quarter 1 (July, August and September 2020) – lodgment due date 28 October 2020
    • monthly – you will be eligible to receive the credit for    
      • June 2020 – lodgment due date 21 July 2020
      • July 2020 – lodgment due date 21 August 2020
      • August 2020 – lodgment due date 21 September 2020
      • September 2020 – lodgment due date 21 October 2020.

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      Last modified: 31 Jul 2020QC 61925