Small Business Stewardship Group special briefing 17 June 2020

COVID-19

JobKeeper payments

The Government has announced that Treasury will conduct a review of JobKeeper.

We are continuing to work on our communication approach and language to ensure our advice to the small business community is easy to understand and act on. The size, scale and speed of implementation of JobKeeper did not allow for the usual comprehensive consultation process.

We are reviewing our communications to businesses to ensure they clearly outline what action is required to release payments and the reason we request certain information.

We are committed to achieving the right balance between pre-issue and post-issue compliance. Most held payments are due to eligibility issues. The number of payments being held for integrity checks is very low.

There have been some instances of fraud reported in the media. The number of fraud cases is very small. These cases are being referred to the relevant law enforcement agencies.

We are seeing instances of employees being claimed by multiple employers. There are many reasons why this might be happening, and we have been calling employers where we believe they need assistance.

We share data with Services Australia to help them administer the JobSeeker scheme. This information is not shared automatically and is tightly controlled. There is legislation currently before the Parliament which will enable us to share data with the Fair Work Ombudsman.

Member insights

Based on recent changes to JobKeeper in the childcare sector, there is uncertainty around whether childcare centres will still be able to claim JobKeeper.

Members suggested the Government’s JobKeeper review should reconsider the current arrangement where only one person in a partnership can claim JobKeeper.

Members want further clarity about the integrity checks and compliance approach for JobKeeper payments.

Additional industry-based demographic information regarding JobKeeper will be useful for helping industry bodies to target their communication and support activities.

Members re-iterated that stopping JobKeeper too soon could place certain industries at risk.

Boosting cash flow for employers

We are generally processing credits quickly, however a small percentage are held for integrity purposes.

To help taxpayers understand their eligibility for the cash flow boost, we have issued an eligibility guide.

We continue to work with taxpayers who did not have an existing employment arrangement in place or had attempted to back date arrangements.

A large engagement program commenced in the week beginning 8 June asking taxpayers for further information to support their cash flow boost eligibility.

Member insights

Members discussed the advice being provided through the ATO call centre about non-payment of cash flow boost. They suggested that the reasons for payment delays need to be communicated more clearly.

Early release of superannuation

We are preparing for the next round of early release applications and looking at the current processes regarding integrity. We want to help applicants get their claims right for the next round post 1 July 2020.

Instant asset write-off

The Government announced an extension to the Instant asset write-off to 31 December 2020.

Member insights

Better communication regarding motor vehicles is necessary, i.e. cars can only be claimed up to car depreciation limit of $57,581 and not $150,000. The ATO referred members to the current material on ato.gov.au and additional material (Instant asset write-off and how it applies to vehicles.pdf) was sent to group members on 28 May. This material was developed with motor industry stakeholders.

The rules around purchases, particularly the ‘installed ready for use’ issue need to be spelt out more clearly on the ATO’s website.

Agency updates

The Australian Small Business and Family Enterprise Ombudsman advised the states and territories have enacted the commercial tenancy codes. These codes vary across our federation. The Ombudsman is currently helping resolve many tenancy disputes and is seeking to resolve them prior to mandatory mediation.

The Victorian Small Business Commissioner has found tenants have trouble starting the conversation with their landlord around rent reductions. A letter templateExternal Link developed by the NSW Small Business Commissioner is now being used in Victoria.

The Department of Industry, Science, Energy and Resources advised that the Payment Times Reporting (Consequential Amendments) Bill 2020External Link has been referred by the Senate to the Education and Employment Legislation Committee for inquiry. Inquiry submissions are due by 3 July and the report is due 30 July 2020.

The Government announced a campaign to help small business recover from the COVID-19 restrictions. Council of Small Business organisations Australia will manage the Back your local small businessExternal Link campaign.

Member insights

Many businesses will not survive COVID-19. We must be prepared to help people exit their business without shame or stigma. We must be ready to support them during what will be a very difficult time.

Members stressed upon agencies not to underestimate the pressure on small businesses. The compounding pressures associated with drought, bushfire and COVID-19 are taking their toll.

The Victorian Small Business Commissioner has some important informationExternal Link to support small business owners to manage their mental health in response to COVID-19.

Communication updates

We have updated our communications on the integrity measures associated with COVID-19 stimulus measures.

We have published information addressing frequently asked questions about pausing or ceasing trading.

We issued a media release reminding individuals including new sole traders to link to MyGov for tax time.

Industry groups are keen to provide advice to members on how to get stimulus claims right. Examples of ‘what not to do’ would be useful.

Members requested advice on the treatment of the various Federal, State and Territory stimulus measures and grants. For example, which are taxable, and which need to be included in JobKeeper turnover estimates, etc. It would be valuable if all this information was published as a single, comprehensive document and or easy to understand web material.