COVID-19 Business Update – 6 May 2020
In this week’s update, as well as some updates on government support for businesses, we’ve included a number of resources to help with navigating your business out of the dire situation we’ve all been in.
No doubt there are still tough times ahead but there are many reasons to be hopeful and we’re here to help you through it all.
The first JobKeeper payments are expected to flow this week. And I can’t say it is coming quick enough. We know business owners are desperate for these funds. Please allow up to 14 days from the date of the monthly reporting for the funds to come through. We are expecting those who don’t report via Single Touch Payroll to be manually reviewed and may take the longest for the ATO to action.
JobKeeper Monthly Declaration
Businesses accepted into the JobKeeper program are required to make monthly declarations to the ATO. This monthly declaration is to update your current and projected GST turnover and reconfirm eligible employees. Businesses need to make these declarations before they receive their payments. Yes, you read that correctly, if you don’t do the monthly reporting/declaration, no JobKeeper funds will make their way to your bank account.
We recommend using a qualified BAS or Tax Agent to assist you (we can certainly help you complete JobKeeper monthly reporting). You will need to fill out a consent declaration so this can be completed on your behalf. Ask us if you have any questions. Please note that if you complete the reporting yourself, you are declaring that you have already paid any required top up amounts to your employees. The penalties for falsey declaring this information are HUGE.
Businesses aiming to back in July
The government announced their goal to get the “overwhelming majority” of Australian businesses back open in July, in a “COVID-19 safe environment.” State and territory leaders will meet again this Friday to discuss the steps to lift restrictions, so we will have more detail then. It is said that cafes, restaurants and retail may be in the first wave of those allowed to reopen. Each state will ease restrictions at its own pace, but all will have the common goal of July. The government issued a reminder that social distancing, hygiene and international travel restrictions will remain indefinitely.
According to the Financial Review:
- 1 million people have lost their jobs in the last 6 weeks
- Another 5 million are receiving the JobKeeper wage subsidy
- $7 billion in emergency cash payments has been accessed by 384,000 businesses
- Treasury data estimates that the current restrictions are costing the economy $4 billion a week.
Clearly, getting people back to work will help restart the economy which is good news for all of us.
Time to revisit your business plan
We’re guessing you didn’t factor and global pandemic and national lockdown into your 2020 business plan!
So it’s definitely a good time to revisit your business plan for the next year. We know that writing a plan can feel like a big effort so here’s a template to make it easier. Please get in touch if you’d like to talk about your plan – especially the financial parts like cash flow.
With little revenue coming in, the old adage “cash is king” is more relevant than ever, and financial uncertainty will likely impact everyone, even those who are making good money. Lifehacker offers up reasons on why you might consider a budget, and why you should be skeptical of the great deals that cash-starved retailers may be pushing. For example, saving $20 on something that costs $100 might seem like a great idea, but you still have to spend $80, and perhaps that $80 could be spent on something more important. Keeping that cash in hand might be more valuable than saving money later.
Pivot don’t pause your marketing
It’s a classic business mistake to cut marketing when cash flow is tight. This often means you’re sealing your fate as without new customers, businesses wither and die.
This article from MYOB NZ makes some suggestions on how to refocus your marketing for the new economy we suddenly find ourselves part of.
Working from home
Now that many of us have been working from home for a month or more, the cracks are beginning to show. Zoom meetings all day can be more fatiguing than working in the office all day. Fast Company has these tips to preserve your energy.