How can you budget in 2022 after your government payments stop?

Budgeting after Government payments stop

With life steadily going back to (the new) normal, it’s time to think about your business budgeting, after Government payments cease.

We know that a lot of our clients were supported by the Federal Government throughout the 2020-2021 period with JobKeeper and COVID-19 support payments. This was an amazing way to maintain our economy and help businesses, but we need to ensure they were a short-term assistance and are not used in future forecasting.

How much money did the Federal Government spend on COVID-19 payments?

Firstly, it’s important to know just how much money was given out by the Federal Government for COVID-19 payments.

The main economic measures that assisted small to medium businesses throughout the Hunter were:

One of the largest grants was the JobKeeper package which paid wage grants for 3.8 million Australians. Over $89 billion was spent on this program alone.

The Cashflow boost helped 800,000 businesses, with large scale payments anywhere from $20,000 to $100,000.

The Government also spent $35 billion on the Cashflow boost. There was an extra $20 billion spent on the Coronavirus supplement for Australians who were on the JobSeeker payments.

Set your budget the way your business likes it

When considering the budget for your business there is no wrong or right way. Budgeting comes down to individual preference and is dependent upon how your business likes to prepare.

Having it set out in a way that makes sense to the people using it is essential to make sure it is actually used.

That’s why, budgeting after Government payments have stopped coming in is an integral part of your January 2022 to-do list.

Your business needs to be realistic in its thought process when creating its budget, if you add in any impractical parts then you are setting your business up for disaster from the beginning.

Take what you’ve learned during 2020 and 2021

It is important to think about what you learnt throughout this pandemic time that may be beneficial for your business moving forward. Especially when budgeting after government payments have ceased.

Something that became very clear to many business owners was identifying how much ‘emergency’ money they need (or want) for any unexpected situations. A pandemic was certainly not something that had been considered as a possible risk to most businesses!

Finding assistance after COVID-19 government payments stop

As much as budgeting after Government payments have stopped can seem extremely daunting, it is important to remember there are always Government programs that are targeted at small businesses.

Researching what your business may be eligible for is a great step to do before starting your budget for the year.

Similarly, the 2021/2022 Federal Budget has several initiatives to help small businesses during the financial year. Some of these include:

Extension to temporary full expensing of assets
Extension to temporary loss carry-back offset
Changes to superannuation guarantee threshold
Low- and middle-income tax offset extension
Apprenticeship wage subsidy expanded
$250 exclusion on self-education deductions to be removed

If you want any further information about small business wins in the Federal Budget, head to our blog here!

Are you still concerned about budgeting after Government payments cease in the new year? Get in touch with us to help you manage your business finances.