It has been reported that some of Australia’s largest companies have determined that COVID-19 had the reverse impact on their bottom line and they have reported record profits during this pandemic.
A number of these companies have determined that the Job Keeper payments they received are in excess of their needs, and would like to pay them back to the ATO. These acts of corporate goodwill are, of course, few and far between. At the other end of the spectrum some companies are reporting huge dividend payouts and excessive executive bonuses. This will result in extra taxes paid by them (if they haven’t devised a scheme to “minimise tax’) .
Repaying the Job Keeper payments goes further to improve corporate credentials. We as consumers and ethical investors need to investigate and support these companies in the years to come as this is an example strong leadership and corporate social responsibility.
Only one problem exists – there is a small hiccup at the moment for companies wanting to repay funds. The ATO need to determine if the pay back will be tax deductible, as at the moment the payback does not fit their definition of a deduction (Section 8-1 of the Income Tax Assessment Act 1997).
Watch this space!