Boosting Cash Flow for Employers
March 24, 2020
Exactly how the cashflow support works
This is the largest part of the federal government's economic stimulus package. It was first announced on 12 March, expanded on 22 March and legislated on 23 March. With the rapid changes and rollout, people are understandably confused.
Am I eligible?
To get the payment, you must be an employer. The payments will only be available to active eligible employers established prior to 12 March 2020.
How much do I get?
The calculation is based on tax withheld from employees and is a little bit complex. Generally speaking:
If you pay your PAYGW quarterly, the amount you receive will be
- 100% of your January - March 2020 PAYGW when you lodge your January to March 2020 Activity Statment. Minimum of $10,000 even if your PAYGW is zero. Maximum of $50,000.
- 50% of that amount again when you lodge your April to June 2020 Activity Statement (if your entity is still active)
- 50% of that amount again when you lodge your July to September 2020 Activity Statement (if your entity is still active)
If you pay your PAYGW monthly, the amount you receive will be
- 300% of your March 2020 PAYGW when you lodge your March 2020 Activity Statment. Minimum of $10,000 even if your PAYGW is zero. Maximum of $50,000.
- 25% of that amount again when you lodge your April 2020 Activity Statement (if your entity is still active)
- 25% of that amount again when you lodge your May 2020 Activity Statement (if your entity is still active)
- 25% of that amount again when you lodge your June 2020 Activity Statement (if your entity is still active)
- 25% of that amount again when you lodge your July 2020 Activity Statement (if your entity is still active)
How is it paid?
The amounts will be applied as credits in your Activity Statement acocunt with the ATO. If there is remaining credits, they will be refunded in cash.
When do I get it?
The government has indicated that the amounts will be applied following the due date for each Activity Statement
Do I need to register?
No, the payments are automatic.
Can I increase my wages so I get more?
No. The government has introduced a specific integrity rule that is designed to stamp out artificial or contrived arrangements that are implemented to obtain access to this measure. In particular, if an employer or an associate enters into a scheme with the sole or dominant purpose of obtaining or increasing any of the above payments for a particular employer, for a period, the employer will not be eligible for any such payments for the relevant period.
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