Small Business Support Payments

You don’t need to pay tax on some COVID-19 payments from the governments to support small businesses. These payments will be non-assessable non-exempt (NANE) income for tax purposes.

There are two types of grant programs announced by the government that may be NANE income: These are:

• State and Territory grants relating to recovery from COVID-19

• Commonwealth support payments established under the COVID-19 Business Assistance Program.

Likewise, the ATO notes that if a business receives an invoice from their accountant for the application of the grant, alongside other professional services, a deduction cannot be claimed for the part that relates to getting the non-taxable government grant. QC63381.