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The Payment Times Reporting Scheme begins on 1 January 2021. While aimed at assisting small businesses when engaging with large business customers, the Scheme has significant implications on negotiated payment terms and compliance obligations for large business customers.
Following two inquiries by the Australian Small Business and Family Enterprises Ombudsman in 2017 and 2019 into the payment times and practices of large businesses, the Federal Government has introduced the Payment Times Reporting Scheme. The Scheme is comprised of two Bills, which received royal assent in September and October 2020, and will come into effect on 1 January 2021. A summary of the Bills is outlined below.
December 17, 2020
This year, the federal government passed a range of new legislation to help small businesses withstand the effects of the COVID-19 pandemic.
While some of these initiatives are familiar, such as JobKeeper and changes to insolvency, from January 1, 2021, important changes will occur.
Here are four changes SMEs need to know.
1. JobKeeper extension
The extension of JobKeeper 2.0 starts on January 4, and will run until March 28, with lower rates for employees working full-time and part-time.
To claim JobKeeper payments for this period, businesses need to show that their actual GST turnover has declined in the December 2020 quarter relative to the same period in 2019. More information about the eligibility test is available here.