Monthly Archives: October 2021

State government assistance to the construction industry

Compensation is available to firms within the construction industry that were closed for the two weeks ended 4th October 2021.  Payments are tiered according to payroll size.

The compensation program is called Business Costs Assistance Program Round Four – Construction.

So how does my business qualify:-

  • Must have held an ABN as of 24th September 2021.
  • Must have been registered for GST as of 24th September 2021.
  • Have a payroll of less than $10,000,000.
  • If your business employs, you must be registered with WorkCover.
  • If your business doesn’t employ anyone, you must hold a WorkSafe Construction Induction Trading Card.
  • You must operate within an eligible sector – click here to check your business.
  • Your business must have incurred costs directly due to the lockdown and were not able to operate remotely.
  • Your business must have been contracted to work within a lockdown municipality.

Costs directly incurred as a result of the lockdown include such outgoings:-

  • Contract penalties
  • Equipment rental
  • Paid employee leave for staff who were prohibited from attending a work site.

Business that received any one of last year’s three rounds of the Business Support Fund and/or the Pay-roll Tax rebate/waiver can apply.

However, businesses do not qualify for round 4 if the received any one of:-

  • Business Costs Assistance Program Round Two
  • Business Costs Assistance Program Round Two – July Extension
  • Small Business COVID Hardship Fund

Those businesses still awaiting the outcome of their application to those three programs can apply for Round 4.  If successful under any of the four programs, they will be paid under the grant that pays the greatest amount.

The grant amount is tiered to payroll size:-

  • $2,000 for non-employing businesses.
  • $2,800 for employers with an annual payroll of less than $650,000.
  • $5,600 for employers with an annual payroll between $650,000 and $3,000,000.
  • $5,600 for employers with an annual payroll between $3,000,000 and $10,000,000.

Applications are to be processed within 10 business days with the program closing on 9th November or earlier of the allocated funds run out.

We welcome the opportunity to examine whether you qualify, answer any questions you may have or assist you with your application.

Does your businesses now qualify for rent relief?

Many Victoria businesses suffered through lockdown.  But whilst it may have been tough from early August, many businesses did not see their turnover fall by more than 30% in a 3 month block to the end of September.

This was unfortunate as it meant rental relief could not be back-dated to 28th July.

But what seems to have been forgotten is that, with the three months ending 31st October being almost all in lockdown, there may have now been a greater than 30% fall in turnover.  Such businesses would now qualify for rental relief until mid January 2022.

So is your business one that now qualifies?

 

 

Director Identification Numbers

Over the next 13 months, every director needs to apply for what is called a Director Identification Number (aka Director ID & DIN).

The purpose is so ASIC can identify every director in Australia.  This is primarily being done to prevent what is called phoenixing.  Phoenixing is where one insolvent company is abandoned only for that business to suddenly be run by another company; that new company might have the same directors or relatives thereof.  If your business has been dudded by such activity then you will be all in favour of this.

DIN’s are also being introduced to prevent fake identities being used.

To facilitate this, the ATO will be entrusted with the system.  And what was known as the ABN registry will become the Australian Business Registry Services.

There will be a transition period with the expectation that by November 2022, all Australian directors will have been issued with their director ID.

  • From November, any new director will need to apply for DIN and do so within 28 days.
  • Current directors need to have applied for their DIN by November 2022.
  • By November 2022, a first time director will need to apply for a DIN before becoming a director.

So you will be issued with a unique number.  You will be issued with just one number irrespective of how many companies you are a director of and it will stay with you until the grave (and never be re-assigned to anyone else).

How do you apply

Somewhat oddly, directors must apply for their own DIN; accountants and lawyers cannot do so for their clients.  This seems a remarkably impractical requirement given the age and computer abilities of many directors.  Furthermore, many of our clients don’t have (nor want) a MyGov account but will be forced to open one.  Some clients don’t even have a computer (which is not  crime).  Moreover, many will feel uncomfortable providing proof of identity documents such as passports, birth certificate and drivers licence.  Only those with a disability, injury or illiteracy can ask someone to ask on their behalf.

The fines for non-compliance are breath taking – 5,000 penalty units ($1,050,000 – yes more than $1mAUD) or three times any benefit derived.

This process will also clean up ASIC’s data base which is full of permutations of a director’s name and/or address.  It is not uncommon to on board a new client and find there are 3 versions of their name across multiple entities due to a missing middle name or mis-spelt names.  Fortunately, this is a process we have already been tidying up as part of our new corporate affairs program you have seen by virtue of the new ASIC Annual Reviews.

Whilst we are denied from being able to apply on your behalf (as we can do for Tax file Numbers, and ABN applications) we will happily answer any question you may have so we can point you in the right direction.

 

 

 

SG super reminder

Thursday 28th October is the end date for satisfying Super Guarantee (SG) super obligations for the September 2021 quarter.

But as super clearing houses take up to 10 days to pass the money through to the super fund, it means that processing and payment to the clearing should be made no later than this Friday.

And please make sure you have been calculating super at 10% since it increased on 1st July 2021.

And being the start of a new financial year, we take the opportunity t remind you that SG super is payable on all forms of remuneration including:-

  • Commissions.
  • Bonuses (but see below).
  • Directors’ fees and all other forms of remuneration to directors.
  • Allowances (except where fully expended).
  • Individual contractor paid mainly for their labour.

But excluding the following forms of remuneration:-

  • Overtime.
  • Reimbursements.
  • Unused annual leave on termination.
  • Remuneration of less than $450 in a month.
  • Bonuses that are only in respect of overtime.
  • Bonuses that are ex-gratia but have nothing to do with hours worked (harder to satisfy than what you might think).
  • In respect of employees younger than 18.
  • Employees carrying our duties of a private or domestic nature for less than 30 hours in a week (such as nannies).
  • On quarterly remuneration greater than $58,920.
  • Non-residents performing work for an Australian business outside Australia.

SGC super should never be paid late as late payments attract substantial interest and penalties.  Furthermore, and SG (and BAS) liabilities that remain unreported and unpaid after 3 months automatically become personal debts of directors.

We welcome any question you might have.