Before you receive cash flow boosts
To receive the boosts, you must lodge your activity statement for PAYG withholding.
If your business is a large withholder for PAYG withholding purposes, you should continue to pay your PAYG withholding to us as normal. To receive the boosts, you must lodge the activity statement for your other obligations (such as GST).
For more information, see What you need to know.
Initial cash flow boost
Cash flow boosts will be delivered initially when you lodge your activity statements for each monthly or quarterly period from March to June 2020, and additionally from June to September 2020.
Timing
The initial cash flow boosts will be delivered as credits in the activity statement system when you lodge your activity statements for each monthly or quarterly period from March to June 2020.
When you lodge your June 2020 activity statement you will receive both initial and additional cash flow boosts as credits.
Time limits
The law imposes time limits on the crediting of cash flow boosts amounts. The ATO cannot pay cash flow boost for a tax period if the BAS for that period is not lodged within 2 years of its due date. If an original BAS is lodged within 2 years but is later amended in a way that changes the amount of cash flow boosts payable, the ATO can pay any additional cash flow boosts until 30 June 2026. From 1 July 2026, the ATO is forbidden from paying any further cash flow boosts amounts.
Amount
Your initial cash flow boost amount is based on the amount of your PAYG withholding.
Eligible businesses that withhold tax on their employees' salary and wages will receive a credit equal to 100% of the amount withheld, with the following exceptions:
- Monthly lodgers will receive a credit for March 2020 which is 300% of their withholding for that month – this will provide an approximate equivalent to lodgers reporting quarterly.
- Eligible businesses will receive a minimum of $10,000 across March to June 2020, even if their total withholding is less than $10,000.
- Total cash flow boosts for March to June 2020 cannot exceed $50,000.
If you receive the minimum credit of $10,000 you will not be eligible to receive any more cash flow boosts until your PAYG withholding exceeds $10,000 over the eligibility periods.
Example 1: PAYG is less than $10,000 in first period
Tim owns and runs a small paper delivery business in Melbourne and employs 2 casual employees who each earn $10,000 per year. In the March 2020 quarterly activity statement, Tim reports:
- wages paid at W1
- $0 at W2, because his employees are under the tax-free threshold.
The March 2020 quarter is the first period Tim is eligible for an initial cash flow boost. His withholding of $0 is less than $10,000. This means Tim's initial cash flow boost will be the minimum amount of $10,000.
Tim will not receive any further initial cash flow boosts unless his withholding in the June 2020 quarter is greater than $10,000. However, Tim may receive the additional boosts when he lodges his June and September activity statements (see quarterly reporting example).
Example 2: total cash flow boosts reaches maximum limit of $50,000
Sarah owns and runs a building business in South Australia. She employs 8 construction workers who each earn $89,730 per year. In the activity statements for March, April, May and June 2020, Sarah reports:
- wages paid at W1
- withholding of $15,008 at W2.
As her March 2020 withholding is greater than $10,000, Sarah’s initial cash flow boost is $45,024 (3 × $15,008).
For April 2020, Sarah's withholding is $15,008. However, there is only $4,976 of the initial cash flow boost remaining before she reaches the maximum limit of $50,000. This means for April 2020 she will receive a further initial cash flow boost of $4,976.
Sarah will not receive any further initial cash flow boosts after she has reached the $50,000 limit.
End of exampleKey dates
If you lodge:
- quarterly – you will be eligible to receive the credit for
- quarter 3 (January, February and March 2020) – lodgment due date is 28 April 2020 (see note)
- quarter 4 (April, May and June 2020) – lodgment due date 28 July 2020
- monthly – you will be eligible to receive the credit for
- March 2020 – lodgment due date 21 April 2020
- April 2020 – lodgment due date 21 May 2020
- May 2020 – lodgment due date 22 June 2020
- June 2020 – lodgment due date 21 July 2020.
Note: If you have been affected by the 2019–20 bushfires, automatic lodgment deferrals are in place until 28 May 2020.
Additional cash flow boost
Timing
If you received initial cash flow boosts, you will automatically receive additional cash flow boosts when you lodge your activity statements for each monthly or quarterly period from June to September 2020. These will be delivered in either 2 or 4 instalments, depending on your reporting period.
If you haven't made payments to employees subject to withholding from June onwards, report '0' for PAYG withholding when lodging your activity statement to ensure your business still receives the additional cash flow boost. It's important you don't cancel your PAYG withholding registration until you have received the additional cash flow boost.
Amounts
The amounts will be equal to the total amount of initial cash flow boosts received and split evenly over the lodgments for the periods June 2020 to September 2020.
If you lodge:
- quarterly – you will receive 50% of your total initial cash flow boosts for each activity statement
- monthly – you will receive 25% of your total initial cash flow boosts for each activity statement.
Both the initial and the additional cash flow boosts will be credited when you lodge your June 2020 activity statement unless you already received the maximum $50,000 of initial cash flow boosts from earlier periods.
Example 1 – quarterly activity statement
Tim received initial cash flow boost of $10,000. When Tim lodges his June and September 2020 quarterly activity statements, he will receive additional cash flow boosts as follows:
- $5,000 for quarter ended June 2020
- $5,000 for quarter ended September 2020.
Example 2 – monthly activity statement
Sarah received the maximum initial cash flow boosts of $50,000. When Sarah lodges her June to September 2020 activity statements she will receive additional cash flow boots as follows:
- June 2020 – $12,500
- July 2020 – $12,500
- August 2020 – $12,500
- September 2020 – $12,500.
Example 3 – withholding declining during the coronavirus situation
Mary has employees and withholds from their wages. She is eligible to receive the cash flow boost. When she lodges her quarterly activity statements she reports withholding as follows:
- March 2020 – $12,000
- June 2020 – $2,000
- September 2020 – $0.
When she lodges her activity statements, Mary will receive cash flow boost credits of:
- March 2020 – $12,000 from the initial cash flow boost
- June 2020 – $2,000 from the initial cash flow boost plus $7,000 from the additional cash flow boost
- September 2020 – $7,000 from the additional cash flow boost.
Key dates
If you lodge:
- quarterly – you will be eligible to receive the credit for
- quarter 4 (April, May and June 2020) – lodgment due date is 28 July 2020
- quarter 1 (July, August and September 2020) – lodgment due date 28 October 2020
- monthly – you will be eligible to receive the credit for
- June 2020 – lodgment due date 21 July 2020
- July 2020 – lodgment due date 21 August 2020
- August 2020 – lodgment due date 21 September 2020
- September 2020 – lodgment due date 21 October 2020.
See the due dates for lodging and paying your BAS.
What you will receive
The cash flow boosts will be applied to reduce liabilities arising from the same activity statement.
You can estimate how much cash flow boost you may receive by using the Cash flow boost estimator (XLSX, 5.3MB)This link will download a file.
It is important to make sure your financial institution details are up to date for your activity statement account. You can check and update them using our online services or contact your tax or BAS agent.
Cash flow boost credits will be visible on your statement of account. They will appear as 'cash flow boost 1' for amounts relating to March to June 2020, or in the case of the additional cash flow boost from June to September 2020, as 'cash flow boost 2'.
Offsetting
From 1 January 2022, the usual debt offsetting rules will apply. This means eligible activity statements for March 2020 to September 2020 that are lodged on or after 1 January 2022, and receive cash flow boost amounts, will have any credits offset against existing tax debts before being refunded.
We understand that businesses may still be experiencing financial difficulties as a result of the COVID-19 pandemic. For support, speak with your registered tax practitioner or phone us on 13 11 42 during operating hours.
For more information, see Support to lodge and pay.
Refunds
There are some circumstances where cash flow boost credits can be refunded to you instead of being offset against other tax debts, for example, when you:
- lodge your March 2020 to September 2020 activity statements, or receive a lodgment deferral, on or before 31 December 2021.
- make a request for a refund due to financial hardship or other unique circumstancesYou may also receive a refund if you overpay your activity statement because your system was unable to take the cash flow boost into consideration when working out how much was payable.
If you are due to receive a refund, we will generally pay it within 14 days.
Example1: overpaying activity statement
Sanjay's software calculates the liability for the quarterly March 2020 activity statement as $12,500. It does not account for any initial cash flow boost he may be entitled to. He pays the liability immediately.
Sanjay is entitled to an initial cash flow boost of $10,000. This means the March 2020 quarterly activity statement will be in credit by $10,000. Generally, the overpayment of $10,000 is refunded to Sanjay.
End of example