COVID-19 financial stimulus packages
We break down the support payments recently announced by the government, including early access to superannuation.
As we continue to navigate these challenging times with COVID-19, your super remains in good hands with Slate Super, and our experienced team will continue to look after your retirement savings as they always have.
Slate Super was built on the philosophy that super doesn’t have to be complicated, and every member is more than just a number to us. We’re working hard to ensure we can continue to provide our high standard of member services to you now, and in the coming months ahead.
The Federal Government announced a financial stimulus package to help Australians impacted by COVID-19, including temporary early release of superannuation, and support payments such as the new JobKeeper and JobSeeker Payments. We have provided more information on these payments below.
Temporary early access to superannuation
Updated: August 1, 2020
The application process for the first round of accessing up to $10,000 from your superannuation commenced in mid-April. If eligible, you will also be able to apply to access up to a further $10,000 from July 1, 2020. This application period has been extended until December 31, 2020.
Please note: Withdrawing super savings during periods of extreme volatility could crystallise losses, and could leave members with low balances once the markets start to recover. Superannuation is designed to be a long-term investment. Choosing to access your super early should be an informed decision and take into account your personal and financial circumstances. We strongly recommend you seek professional advice before making a financial decision about your super account.
To apply for early release, you must satisfy any one or more of the following requirements:
- You are unemployed; or
- You are eligible to receive a job seeker payment, youth allowance for job seekers, parenting payment (which includes the single and partnered payments), special benefit or farm household allowance; or
- On or after January 1, 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.
Tax and Centrelink implications
None. If the ATO finds you eligible to make a withdrawal, you will pay no tax on the amounts released, and the withdrawals will not affect your eligibility for Centrelink or Veterans’ Affairs payments.
Application process and timing
Applications opened on April 20, 2020. The second round of applications opened on July 1, 2020, and closes on December 31, 2020.
You will need to make an online application to the ATO via the MyGov website or by calling the ATO if you’re unable to access online services. The ATO will consider your eligibility for payment and issue a determination notification to both you and your super fund. You’re required to input bank account details into myGov and authorise the ATO to provide the details to your super fund.
It will take approximately 1 to 2 business days for us to receive the determination notification from ATO, and we will then release the funds as soon as possible to your designated bank account.
Businesses impacted by COVID-19 may be able to access the JobKeeper wage subsidy to continue paying their employees. Affected employers will be able to claim a fortnightly payment of $1,500 per eligible employee from March 30, 2020, for a maximum of 6 months. Eligible employees will receive a minimum of $1,500 per fortnight, before tax. It will be up to the employer if they want to pay superannuation on any additional wage paid because of JobKeeper Payments. Eligible employees include Australian citizens, the holder of a permanent visa, or a Special Category (Subclass 444) Visa Holder. Full time and part time employees, including stood down employees, would be eligible for the JobKeeper Payment. Where a casual employee has been with their employer for at least the previous 12 months they will also be eligible for the Payment.
Employees will be able to receive this payment in a number of different ways:
- If you ordinarily receive $1,500 or more in income per fortnight before tax, you will continue to receive your regular income according to the prevailing workplace arrangements. The JobKeeper Payments will subsidise part or all of your income.
- If you ordinarily receive less than $1,500 in income per fortnight before tax, your employer must pay you, at a minimum, $1,500 per fortnight, before tax.
- If you have been stood down, your employer must pay you, at a minimum, $1,500 per fortnight, before tax.
- If you were employed on 1 March 2020, subsequently ceased employment and then were re-engaged by the same eligible employer, you will receive, at a minimum, $1,500 per fortnight, before tax.
If you’ve lost your job, or are a sole trader and your income has dropped dramatically, you might be eligible for the Government’s new JobSeeker Payment. From March 20, 2020, JobSeeker Payment replaces Newstart Allowance as the main income support payment for recipients aged between 22 years to Age Pension qualification age, who have the capacity to work. You can apply for this payment if you’re an Australian resident without a job who is currently looking for work, or who temporarily cannot work or study due to an injury or illness, or you are dealing with the death of your partner. Here’s a helpful, step-by-step guide to the application process. Eligibility has been expanded to include:
- A permanent employee who has been stood down or lost their job;
- A sole trader, self-employed, a casual or a contract worker whose income has been reduced; and
- A person who is caring for someone who is affected by COVID-19.
The 3-month Ordinary Waiting Period is waived while these temporary arrangements are in place, as well as the liquid asset test waiting period, the newly arrived residents waiting period and the seasonal work preclusion period.
If you’re an Australian resident between the ages of 16 and 21 and you’re either looking for full-time work, studying part-time and looking for work, or temporarily unable to work, you may be eligible for the Government’s Youth Allowance Payment.
Centrelink has an online tool that can help you understand what payments and services you may be eligible for. Please be aware that Centrelink has been experiencing delays due to the volume of enquiries and online applications since this package was announced.
If you’re already receiving an income support payment like the JobSeeker Payment or the Youth Allowance Payment, the Federal Government has this week also announced a temporary COVID-19 supplement payment. The supplement will be an additional $550 a fortnight on top of your normal payment rate for up to six months. You don’t need to do anything in order to receive this payment. From April 27, 2020, your normal payment will be increased.
Thank you again for being a member with Slate Super. If you have any questions about your account, you can contact us.