The Government will make a special Coronavirus supplement payment of $550 per fortnight for the next six months to eligible income support recipients.
Individuals will be eligible for the supplement payment if they are currently receiving (or become eligible for) income support.
The supplement will commence from 27 April 2020 and to be deemed eligible an individual would be currently receiving income support such as:
- JobSeeker Payment
- Youth Allowance for job seekers
- Parenting Payment
- Farm Household Allowance
- Special Benefit.
This is in addition to any other benefits being received, so it will be an additional $550 on top of the normal benefits.
Individuals not currently receiving a payment will need to register and claim online through myGov using a Centrelink online account or call Centrelink on 132 850.
Once registered for the JobSeeker Payment, individuals who meet the eligibility criteria automatically become eligible for the Coronavirus supplement.
The Government has expanded access to JobSeeker Payment and made it easier to become eligible, including removing wait times and asset testing requirements.
Early release of superannuation
Individuals may be able to access up to $20,000 of their superannuation in the event of hardship. This is in the form of two separate payments of up to $10,000 and one between 1 July 2020 and 30 September 2020.
To be eligible individuals need to be:
- Unemployed; or
- Eligible to receive JobSeeker payment, Youth Allowance for job seekers, parenting payment, special benefit or farm household allowance; or
- On or after 1 January 2020:
- Have been made redundant; or
- Working hours have been reduced by 20% or more; or
- As a sole trader your business has been suspended or there is a reduction in turnover of 20% or more
Applications for early access to your superannuation benefits will be undertaken via myGov and are expected to be available from mid-April. It is vital that no money is taken until the application has been approved by the ATO, to avoid possible compliance issues.
The withdrawal of $10,000 of superannuation benefits will not be taxable on withdrawal and will not affect any other government payments such as pensions.
The ability to partially access superannuation benefits will allow individuals in hardship to access some cash for basic living needs.
Accessing superannuation benefits should be carefully considered in line with your retirement needs and goals and to ensure items such as life insurance attached to the superannuation benefits are not adversely impacted.
Targeted stimulus payment
The Government will provide economic support payments in two tranches to eligible recipients of the following:
- Social security and Veteran’s income support and compensation;
- Farm Household Allowance
- Family Tax Benefits
Pension Concession Card, Commonwealth Seniors Health Card and Commonwealth Gold Card holders will also be eligible to receive the payment.
Eligibility for the first payment applies for claims for any of the above lodged between 12 March and 13 April 2020.
The second payment will be based on eligibility as at 10 July 2020. Note that anyone receiving the Coronavirus supplement will not receive the second payment.
The payments will be exempt from tax and will not count as income for Social Security, Farm Household Allowance and Veteran payments.
Deeming rates will be reduced and may increase pensions. From the start of May, the lower deeming rate will be 0.25% and upper deeming rate of 2.25%.
For more information
If you require further information regarding the above article, contact your local RSM office today.
To find out more about the current COVID-19 situation, please visit our coronavirus advisory centre.