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Government Stimulus
independent financial advice

Hewison Update: COVID-19 Government stimulus package & what you need to know?

Chris Morcom
Partner/Private Client Adviser
31 Mar 2020

As the community and government response to COVID-19 escalates, there has been a wide range of assistance programs released over the past week and updated over the weekend.

 Some of the assistance is targeted specifically at individuals and families, while other measures are targeted to help businesses cope with pandemic related hardship. Upon reading the following  summary of the government assistance announced to date, as of 22nd March, we strongly recommend contacting your adviser if you would like to clarify any of the measures, and whether they may relate to you:

Support for Individuals and Families

The following is a summary of the assistance being provided by the Federal Government to individuals and families.  More information can be found at https://treasury.gov.au/coronavirus/households .

Income support for individuals:

  • Those eligible for income support payments (Jobseeker Payment, Youth Allowance Jobseeker, Parenting Payment (Partnered or Single), Farm Household Allowance, and Special Benefits recipients will receive a Coronavirus supplement of $550 per fortnight for the next six months from 27th April
  • Eligibility to income support payments for the next six months has been expanded to provide paid access for permanent employees who are stood down or lose their employment; sole traders; the self-employed; casual workers; and contract workers who meet the income tests as a result of the economic downturn due to the Coronavirus
  • Asset testing will be waived for the period of the Coronavirus supplement
  • Reduced waiting times, including the waiving of the ordinary one week waiting period and the liquid assets waiting period
  • Faster claims processes  – those making a claim are encouraged to do so via online and mobile channels or via telephone

Payments to support households:

The Government is providing two separate $750 payments to social security, veteran and other income support recipients and eligible concession cardholders.  The first payment will be made from March 31, 2020 and the second from July 13, 2020.

Temporary early access to superannuation:

Eligible individuals will be able to access up to $10,000 of their superannuation before 1 July 2020 and a further $10,000 from 1 July 2020 for approximately three months.

To be eligible, you must:

  • Be unemployed; or
  • Eligible to receive a Job Seeker payment; or
  • On or after 1 January 2020 you were made redundant; or,
  • Your working hours were reduced by 20% or more; or,
  • If you are a sole trader, your business was suspended or there was a reduction in your turnover of 20% or more.

Applications can be made from mid-April.

Temporary reduction in pension drawdown minimums:

For those who are drawing a pension from their super fund, the minimum required pension for the 2019-20 and 2002-21 financial years is being reduced by 50%.  The table below summarises the change:

Changes to Social Security deeming rates:

The deeming rate for financial assets for those on social security is being reduced from 1 May 2020.  The upper deeming rate will reduce to 2.25% (from 3%) and the lower deeming rate will reduce to 0.25% (from 1%).

Support for Business

The following is a summary of the assistance being provided to businesses by the Federal Government.  More information can be found at https://treasury.gov.au/coronavirus/businesses

Boosting Cashflow for Employers:

  • Payments of up to $100,000 to eligible small and medium-sized business (and not-for-profits) that employ people, with a minimum payment of $20,000.  These payments are to assist businesses to keep operating, pay their rent and other bills and retain staff.
  • Under the scheme, employers will receive a payment equal to 100% of their salary and wages withheld (up from 50%), with the maximum payment being increased to $50,000.  The minimum payment is being increased from $2,000 to $10,000.  The first payment will be made automatically from the ATO from 28th April upon employers lodging eligible activity statements.
  • An additional payment is also being introduced in the July – October period.  The payment for this period will be the same as the first period. 
  • Calculation of the payment is automatic and is done by the ATO through the existing activity statement process.
  • The table below provides more information about the timing of activity statements and payments:

Supporting Apprentices and Trainees:

  • Eligible employers can apply for a wage subsidy of 50% of the apprentice’s or trainee’s wage paid during the 9 months from 1 January 2020 to 30 September 2020. Where small business is not able to retain an apprentice, the subsidy will be available to a new employer.
  • Employers will be reimbursed up to a maximum of $21,000 per eligible apprentice or trainee ($7,000 per quarter).

Temporary Relief for financially distressed businesses:

  • To reduce the threat of being pushed into insolvency and being forced to wind up a business, the Government is increasing the threshold at which creditors can issue a statutory demand and the time companies have to respond to statutory demands they receive.
  • Directors of businesses also receive temporary relief from personal liability for trading while insolvent.

Increasing the instant asset write-off:

  • The Government is increasing the instant asset write-off threshold from $30,000 to $150,000 and expanding access to include all businesses with an aggregated annual turnover of less than $500 million (up from $50 million) until 30 June 2020.

Backing Business investment:

  • The Government is introducing a time-limited 15-month investment incentive to support business investment and economic growth over the short-term, by accelerating depreciation deductions.
  • The key features of the incentive are:
    • benefit — deduction of 50 per cent of the cost of an eligible asset on installation, with existing depreciation rules applying to the balance of the asset’s cost;
    • eligible businesses — businesses with aggregated turnover below $500 million; and
    • eligible assets — new assets that can be depreciated under Division 40 of the Income Tax Assessment Act 1997 (i.e. plant, equipment and specified intangible assets, such as patents) acquired after the announcement and first used or installed by 30 June 2021. Does not apply to second-hand Division 40 assets, or buildings and other capital works depreciable under Division 43.

Support from the Victorian Government

The Victorian Government has also announced a series of programs to assist Victorians to deal with coronavirus related issues. 

Under an announcement on Sunday 22nd March, the Victorian Government will provide emergency relief packages to Victorians self-isolating due to COVID-19 with no access to food and essential supplies.

The program is to support those in mandatory self-isolation, who have little or no food, and no network of family or friends to support them.

Each eligible household will receive a two-week supply of essential goods.

The emergency relief program will be coordinated by the Red Cross in partnership with Foodbank Victoria and will start from Monday 23rd March.

Those not eligible for the emergency relief packages are encouraged to be self-reliant and call on the help of family and friends wherever possible.

Those wishing to access the program should call Victoria’s dedicated coronavirus hotline 1800 675 398.



Hewison Private Wealth is a Melbourne based independent financial planning firm. Our financial advisers are highly qualified wealth managers and specialise in self managed super funds (SMSF), financial planning, retirement planning advice and investment portfolio management. If you would like to speak to a financial adviser on how you can secure your financial future please contact us 03 8548 4800, email info@hewison.com.au or visit www.hewison.com.auPlease note: The advice provided above is general information only and individuals should seek specialised advice from a qualified financial advisor. The views in this blog are those of the individual and may not represent the general opinion of the firm. Please contact Hewison Private Wealth for more information.