Top government incentives businesses need to know about in a post-JobKeeper world
|If you’re thinking the end of JobKeeper means there are no more government incentives for small-to-medium sized businesses, think again.|
Here are a number of other grants, schemes and subsidies you need to know about while they last…
But a word of caution, many of these schemes expire soon, so time is of the essence.
Instant Asset Write-Off Increased
As tax time looms, it’s important for businesses to be aware of changes implemented by the Federal Government in 2020, which could have a significant impact on your claims this tax year.
One major scheme for businesses, announced in the 2020/21 budget was the Instant Asset Write-Off (IAWO), the threshold of which has since been increased from assets worth $30,000 to those up to $150,000.
The eligibility criteria has also been expanded, which means the IAWO can now be accessed by businesses with an aggregated annual turnover of up to $500 million – a significant increase from the initial $50 million threshold announced by the Government.
The higher Instant Asset Write-Off (IAWO) threshold – which applies from 12 March 2020 until 30 June 2021, and can include anything purchased up until 31 December 2020 – provides cash flow benefits for businesses that will be able to immediately deduct purchases of eligible assets each costing less than $150,000.
The threshold applies on a per-asset basis, so eligible businesses can immediately write‑off multiple assets. Eligibility requirements to use the IAWO include:
- your aggregated turnover on the date you purchased the asset
- when the asset was first used or installed ready for use; and
- the cost of each asset being less than the threshold.
Keep in mind that the criteria has changed over time, so it’s worth heading to the ATO website to learn more, or speaking with your financial planner at tax time.
Boosting Apprenticeship Commencements
To assist with the COVID-19 recovery, the Australian Government announced the Boosting Apprenticeship Commencements (BAC) wage subsidy in 2020, to support employers to take on new apprentices and trainees. The popular scheme was subsequently early 2021 to meet high demand.
The multi-billion dollar wage subsidy will enable eligible employers to receive a payment of up to 50% if they take on an apprentice or trainee until 30th September 2021 – so now is the time to consider recruiting an apprentice or trainee to support your business.
The wage subsidy is available for a maximum of $7,000 per quarter per eligible apprentice or trainee and employers of any size, industry or geographic location can apply. If you’re looking for a new apprentice or trainee, but don’t know where to start there are a number of recruitment organisations that specialise in this area, including Maxima. Maxima’s team of skilled recruiters can find the right candidate for your business and help you to make the most of the BAC subsidy. Services include:
- Helping with advertising and recruitment
- Shortlisting and interviewing candidates
- Paperwork, registration and assistance with payroll
- Ongoing mentoring and support.
To find out more about hosting an apprentice or trainee contact Maxima today.
SME Loan Guarantee Scheme Extended
The Coronavirus Small and Medium Enterprise (SME) Guarantee Scheme, which provided a guarantee of 50 per cent to lenders for new unsecured loans for SMEs, has been extended until 30 June 2021.
The scheme was initially launched to encourage lenders to provide credit to SMEs to support them financially through the many disruptions caused by CODID-19 in 2020. The extension, however, provides an excellent opportunity for businesses to rebuild and reassess their businesses and finances in 2021.
Available to SMEs with a turnover of up to $50 million, businesses can use the loans for a broad range of business purposes, including to support investment in this period of economic recovery.
The maximum loan size has also been increased to $1 million per borrower, and can be either unsecured or secured (excluding commercial or residential property). Loans can also now be up to five years rather than three years.
Loans will continue to be subject to lenders’ credit assessment processes and conditions will vary depending on the financial institution. If the scheme is something you’re interested in, it’s best to speak with your bank or creditor for more information, as details will vary.
JobMaker Hiring Credits
The JobMaker Hiring Credit is designed to help more young people get into the workforce as the country recovers from the COVID-19 pandemic.
The program works by providing eligible employers with a weekly payment of $200 for each new employee they hire aged between 16 and 29 years, and $100 a week for those aged between 30 and 35 years old.
The incentive applies to any new employees hired prior to 6 October 2021, with the credit being paid for up to 12 months from the date the new position is created.
Unlike a number of other incentives, employers do not have to satisfy a fall of turnover test.
For more information visit the ATO website.
Mature Age, Indigenous and Young Workers subsidies
There are a number of wage subsidies available to employers to encourage them to hire Mature Age, Indigenous and Young Workers.
For businesses who take on workers between the ages of 15 and 24, over the age of 50 or who are Indigenous, they may be eligible for a wage subsidy of $10,000 (GST inclusive).
Similarly, a subsidy of $6,500 (GST inclusive) is available for new employees who are between the ages of 25 and 29, are parents or have been registered with an employment services provider for 12 months or more.
More information is available from the Department of Education, Skills and Employment.
Looking for a new trainee or apprentice to boost your business in 2021? Let us help! Contact Maxima today on 1300 669 859 for a no-obligation chat with one of our consultants, or head to our Hosting an Apprentice or Trainee page to register your interest in becoming a host employer.