Last year involved an unusual number of legislative changes across the various states and territories, as well as federally, in response to COVID-19. 2021 has started in much the same fashion with a number of changes coming into force early this year.
So, as we embark on what will hopefully be a better year for many, here are the changes you should know about:
The end of JobKeeper is coming
Whilst this isn’t from the first of January, it’s definitely worth mentioning. According to the Financial Review, as of July last year JobKeeper was supporting 960,000 businesses and 3.5 million employees at a cost of $70 billion. The program has been an enormous lifeline for businesses as they adapt to COVID restrictions and new ways of operating.
As of 4 January 2021, JobKeeper payments have been cut from $1200 to $1000 for full-time employees and from $750 to $650 per fortnight for part-time employees. This follows a previous cut in September.
From 28 March 2021, JobKeeper will be cut completely.
JobSeeker has also been cut
Until 31 March 2021, the Coronavirus supplement will continue to be paid, but at a rate of $150 per fortnight. View more on JobSeeker here.
JobMaker is ongoing
Providing incentive for employers to hire younger people, JobMaker Hiring Credit provides eligible employers with $200 a week for hiring people aged 16-30 and $100 a week for people aged 30-35. It is applicable until October this year.
Further COVID-19 retail leasing and commercial leasing laws have been introduced
NSW’s COVID-19 leasing laws have again being extended and the new regulation, which came into effect on 1 January 2021, includes important changes.
The COVID-19 leasing laws are designed to prevent landlords enforcing leasing rights, such as serving breach notices or terminating, against ‘impacted lessees’ for not paying rent. However, this only relates to leases entered into before 24 April 2020 and does not apply if the applicable rental arrears was incurred before that date.
The biggest change under the new regulation is to which tenants qualify as ‘impacted lessees’. From 1 January 2021 this requires:
- a lease which commenced prior to 24 April 2020;
- a tenant who receives JobKeeper;
- a tenant whose 2018/2019 turnover was less than $5 million.
There is also a change in process for landlords to follow where a tenant does not engage in meaningful re-negotiation of the lease terms to apply during the Covid impacted period. Under the previous COVID-19 leasing laws, if the tenant does not comply with the re-negotiation obligations, the prohibition on prescribed action being taken by the landlord against the tenant can end. Under the new regulation, however, when a tenant does not engage in meaningful re-negotiation of the lease terms, the landlord now needs enforcement as an ‘impacted commercial lease dispute’, which typically means that the landlord must progress to the NSW Civil and Administrative Tribunal to obtain relief.
Insolvency reforms will be introduced
Numbers of insolvencies decreased last year but with JobKeeper’s end in sight it is likely that we will see a surge this year. The Federal Government announced significant reforms to the insolvency regime last year which aim to simplify the process and reduce time and costs for small businesses. Learn more about the changes.
Stamp duty could be relegated to the past
Foreshadowed in the NSW Budget, proposed changes would see stamp duty replaced with an annual land tax on new property transactions.
Greater protections for credit card holders
Reforms to the banking sector have continued following the Royal Commission into Misconduct in the Banking, Superannuation and Financial Services Industry. Greater protections for credit card holders include a ban on backdated interest charges and an obligation to assess new applicants on their ability to repay an entire credit card limit.
Scope for political donations tightened
Political parties are no longer permitted to receive donations of $1,000 or more from foreign donors. Foreign governments and state-owned enterprises cannot make gifts worth $100 or more to political parties and campaigners for electoral purposes. In addition, third-party political actors are prohibited from using donations worth $13,800 or more from foreign sources to fund electoral expenditure.
Given the constantly changing landscape for both businesses and individuals at the moment, I expect that more legislative changes will be forthcoming. I will keep you up-to-date with significant changes. In the meantime, if you have any questions please contact me on 0402 136 083.
