Guest Blog – COVID-19: Government support for Australian tradies

Guest Blog – COVID-19: Government support for Australian tradies

Practical advice from a tradie accountant

COVID-19 is having an undeniable impact on the economy. Governments around the world are putting financial measures in place to cushion the blow for businesses and support long-term economic recovery. But times are uncertain, and things are constantly changing, as we’re seeing now in Victoria.
 
Ryan Addinsall from Elevate Accounting Co. has worked exclusively with trades businesses for the past four years – he’s been in accounting for 15 years – and he says one of the best things tradies can do right now to keep their businesses running is to take advantage of COVID-19 government relief.
 
While a considerable amount of government support has been distributed already, there’s more coming, and it can be challenging to identify what you’re eligible for. With that in mind, we had a quick chat with Ryan to see what initiatives you could implement in your trades business – and how this might be able to help as you head into the new financial year.

Tax changes: instant asset write-off

This is an immediate form of support that will help tradies who need to invest in new assets like equipment or tech solutions. Governments have put in place a temporary increase to small business instant asset write-offs. In New Zealand, the threshold has gone up to $5000 until the 17 March 2021, and in Australia, $150,000 until 31 December 2020. So, if your partner has been eyeing up a new truck or tools, now is the time.

Immediate expensing allows businesses to fully deduct the price of low-cost assets when they are purchased. This will help reduce compliance costs for businesses and stimulate business purchases.  

Apprentice incentive schemes

On top of supporting businesses, governments are also focused on keeping people in jobs. There are several incentives designed to help you manage cash flow, keep apprentices in training, and ensure the continued development of the skilled workforce that the economy needs. 

Supporting Apprentices and Trainees provides a wage subsidy to support the retention of existing apprentices and trainees. Also, if your business employs an Australian Apprentice, you might be eligible for financial assistance to help with hiring and training.

Focus on cash-flow boosts

Anything that helps reduce expenses and keep cash flow steady will help  tradies, Ryan says. 

“Make sure you’re receiving and getting the benefit from all the COVID-19 stimulus that’s out there at the moment. That includes cash-flow boosts, trade license-fee reductions or waivers, and any other state government assistance if you’re an Australian tradie.”

To keep your books tidy, Ryan says it pays to get professional help to make sure your accounting for all of the support correctly. 

“Some of the stimulus that’s being received is non-accessible income. Almost all of it is GST free. You want to make sure you’re not declaring and paying tax on income that you don’t need to – it can get quite tricky,” he explains.

Lastly, improving efficiency and streamlining admin processes might not increase your cash flow, but it’ll certainly help you stay on top of things, Ryan says. 

“The worst thing that a lot of trade businesses do is they don’t understand the things they could be doing to get themselves in a better position. Have your books up to date so your accountant can give you advice – and so you don’t miss an opportunity,” he advises. 

Find out what you’re eligible for – or get help

No one knows how long COVID-19 will cast a shadow of uncertainty over life as we know it.  

Financial support from the government can provide a much-needed lifeboat for many businesses struggling to get back on their feet after lockdown – trades businesses should make sure they’re using the support that they’re eligible for. If you’re not sure what funds you’re entitled to, or how to factor in government support in your accounting system, then have a chat with your accountant. 

Struggling with business admin?

Get your admin sorted and your life back. Try a 14-day free trial of Tradify job management software or sign up for a weekly demo to see how Tradify can help you take control of your business admin. Now’s the time to start the new financial year off on the right foot. 

Exclusive Tradie Wives offer!

Ready to roll with Tradify? 

Use the code TWEOFY and get 50% OFF your first 6 months. (Valid until July 31, 2020).

No Comments

Sorry, the comment form is closed at this time.