JobKeeper Payment

JobKeeper Scheme – URGENT Action Required

A legislative instrument was registered on 14 August 2020 amending the current JobKeeper rules to allow businesses to claim the subsidy in respect of new employees with a revised eligibility date of 1st July 2020 (previously 1 March 2020).  These same rules will also apply for eligible business participants where applicable.

These changes apply to JobKeeper payments beginning on or after 3 August 2020 (FN 10 & 11 onwards).

This means you may be able to claim JobKeeper for more employees.

All current employees remain eligible for the JobKeeper scheme up to 27th September, with the new eligibility requirements now including:

  • Casuals who did not meet the 12 month employment requirement at 1st March 2020 but do by 1st July 2020;
  • Full-time and part-time employees employed between 1st March and 1st July 2020;
  • Employees who turned 18 between 1st March and 1st July 2020.

All other eligibility requirements stay in place for both employers and employees.

Most importantly, the ATO require employee nomination notices to be provided to new eligible employees by Monday 24th August in order for these new employees to be eligible.

All new eligible employees must be paid the minimum of $1,500 per fortnight commencing from 3rd August prior to 31 August.

The eligibility of existing employees is preserved if they are already covered by JobKeeper based on the 1 March 2020 reference date. Retesting of their eligibility is not required.

Changes to the JobKeeper rules also now allow individuals who have nominated as an eligible employee or eligible business participant with one entity to re-nominate as an eligible employee of another entity in limited circumstances.

To re-nominate, the individual must have ceased their employment or business participation with the first entity before 1 July, and commenced their employment with the new entity by 1 July.

The legislative instrument also notes that separate amendments will soon be released to detail the JobKeeper 2.0 extension and the two tiers of payments beyond 27 September.

We advise all clients that are currently not enrolled for the JobKeeper scheme, and believe they will suffer a significant decline in turnover, to enrol immediately.

Businesses currently enrolled should review their employee eligibility and enrol any additional staff employed as at 1 July 2020 to enable relevant claims to be made from 3rd August for the month of  August 2020 and beyond.

Should you require assistance in relation to these and all other COVID related subsidy and grant assistance packages please do not hesitate to contact our office.

7 August 2020 – Expanded JobKeeper 3.0 Scheme

In light of the recent introduction of Stage 4 Restrictions to the Melbourne Metro area and Stage 3 Restrictions for the rest of Victoria and the affect that this will have on businesses over the next 6 weeks and beyond, two major changes have been announced today by the Federal Government as this scheme moves beyond September 27 – now to be called JobKeeper 3.0.

The business turnover test and employee eligibility test have been updated.

1.  To qualify for the extension period from 28 September the business will now only have to demonstrate the required decline in actual GST turnover in the previous quarter only. 

  •  Extension Period 1 (28 September 2020 to 3 January 2021) turnover  test will be based on the three month period from 1 July 2020 to 30 September 2020
     
  •   Extension Period 2 (4 January 2021 to 28 March 2021) turnover test will be based on the three month period from 1 October 2020 to 31 December 2020.

2.   From the 3rd August 2020, the relevant date of employment  (to determine an employee’s eligibility to be claimed for JobKeeper) will move from 1 March 2020 to 1st July 2020.  This will enable employers to increase the number of eligible employees under the existing scheme and well as for the new extension periods commencing 28 September.

All other requirements for JobKeeper will still apply. Please refer below. 

We advise all clients that are currently not enrolled for the JobKeeper scheme, and believe they will suffer a significant decline in turnover, to enrol immediately.  If you require assistance, please do not hesitate to contact our office.

Businesses currently enrolled should review their employee eligibility and enrol any additional staff employed as at 1 July 2020 to enable relevant claims to be made for the month of  August 2020 and beyond.

It is important to note that the current JobKeeper payment of $1,500 per fortnight and all other eligibility requirements in relation to turnover decline and employer and employee eligibility will remain unchanged until the 27th September 2020. The only criteria to change until that date is the inclusion of employees from 1 July 2020 which will possibly impact the August 2020 JobKeeper Declaration.

21 July 2020 – JobKeeper 2.0 – Extension to Jobkeeper Scheme

Introduced by the Federal Government on 31st March 2020, known as the ”JobKeeper Payment”, originally due to run until 27th September 2020, will now continue to be available to eligible businesses (including the self-employed) and not-for-profits until 28 March 2021.

It is important to note that the current JobKeeper payment of $1,500 per fortnight and all eligibility requirements thereto will remain unchanged until the 27th September 2020.

All changes detailed below will commence as from 28th September 2020. 

Minimum decline in turnover remains the same and must be:

  • 50 per cent for those with an aggregated turnover of more than $1 billion;
  • 30 per cent for those with an aggregated turnover of $1 billion or less; or
  • 15 per cent for Australian Charities and Not for profits Commission-registered charities (excluding schools and universities).

Extension Period 1 From 28th September 2020 to 3rd January 2021

For eligible employees and business participants:

  • Working more than 20 hours per week – $1,200 per fortnight
    (for all eligible employees who, in the four weeks of pay periods before 1 March 2020, were working in the business or not-for-profit for 20 hours or more a week on average, and for eligible business participants who were actively engaged in the business for 20 hours or more per week on average in the month of February 2020) 
  • Working less than 20 hours per week   –  $750 per fortnight

For the purposes of being eligible for JobKeeper Payments in Extension Period 1, an entity’s:

(a) actual GST Turnover for the June 2020 quarter must be at least 30% less than its GST turnover for the June 2019 quarter; and

(b) actual GST Turnover for the September 2020 quarter must be at least 30% less than its GST turnover for the September 2019 quarter.

Importantly, and unlike the existing JobKeeper Scheme, the decline in turnover calculations above are based on ACTUAL GST turnover.

Both (a) and (b) must be satisfied to qualify for JobKeeper 2.0.

Therefore, if an entity’s June 2020 quarter turnover declined by less than 30% compared to the June 2019 quarter, then it will not be eligible for any further JobKeeper payments in Extension Period 1 or 2. This is the case even if there is at least a 30% decline for the September quarter comparison.

Note: All turnover comparisons are made on a quarterly basis, i.e., there are no monthly comparisons under JobKeeper 2.0.

Extension Period 2 From 4th January 2021 to 28 March 2021

  • Working more than 20 hours per week – $1,000 per fortnight 
  • Working less than 20 hours per week – $650 per fortnight

For the purposes of being eligible for JobKeeper Payments in Extension Period 2, an entity must satisfy all of (a), (b) and (c) as detailed below:

(a) actual GST Turnover for the June 2020 quarter must be at least 30% less than its GST turnover for the June 2019 quarter;

(b) actual GST Turnover for the September 2020 quarter must be at least 30% less than its GST turnover for the September 2019 quarter; and

(c) actual GST Turnover for the December 2020 quarter must be at least 30% less than its GST turnover for the December 2019 quarter.

The fact that an entity was eligible for payments in Extension Period 1 does not mean it is automatically eligible to claim them for Extension Period 2.

Also, if an entity was ineligible to claim payments for Extension Period 1, it is automatically ineligible to claim them for Extension Period 2.

If however an entity/business/sole trader did not make a claim under the existing JobKeeper Scheme this does not prevent it from commencing to claim under JobKeeper 2.0 (assuming it satisfies the relevant tests, including the new Decline in Turnover Test).

The Commissioner of Taxation will have discretion to set out alternative tests that would establish eligibility in specific circumstances where it is not appropriate to compare actual turnover in a quarter in 2020 with actual turnover in a quarter in 2019, in line with the Commissioner’s existing discretion. Information about the existing discretion is available here.

Businesses and not-for-profits will generally be able to assess eligibility based on details reported in the Business Activity Statement (BAS). Alternative arrangements will be put in place for businesses and not-for-profits that are not required to lodge a BAS (for example, if the entity is a member of a GST group).

Employees

The eligibility rules for employees remain unchanged. This means you are eligible if you:

  • are currently employed by an eligible employer (including if you were stood down or re- hired)
  • were for the eligible employer (or another entity in their wholly-owned group) either:
    –  a full-time, part-time or fixed-term employee at 1 March 2020; or
    –  a long-term casual employee (employed on a regular and systematic basis for at least 12 months) as at 1 March 2020 and not a permanent employee of any other employer.
  • were aged 18 years or older at 1 March 2020 (if you were 16 or 17 you can also qualify for fortnights before 11 May 2020, and continue to qualify after that if you are independent or not undertaking full time study).
  • were either:
    –  an Australian resident (within the meaning of the Social Security Act 1991); or
    –  an Australian resident for the purpose of the Income Tax Assessment Act 1936 and the holder of a Subclass 444 (Special Category) visa as at 1 March 2020
  • were not in receipt of any of these payments during the JobKeeper fortnight:
    –  government parental leave or Dad and partner pay under the Paid Parental Leave Act 2010; or
    –  a payment in accordance with Australian worker compensation law for an individual’s total incapacity for work.

Only one employer can claim the JobKeeper payment in respect of an employee.

The self‐employed will be eligible to receive JobKeeper where they meet the relevant turnover test, and are not a permanent employee of another employer.

Employees will continue to receive the JobKeeper payment through their employer during the period of the extension if they and their employer are eligible and their employer is claiming JobKeeper. However, the amount of the JobKeeper payment will change at the rates set out above.

Please call our office should you have any queries or require assistance.

28 April 2020 – ATO Announces Extension to wage payments

The ATO has just announced that it has extended the time in which employers need to pay employees for JobKeeper fortnights 1 and 2 until 8 May 2020.

One of the key requirements of the JobKeeper Scheme is that employers must first pay their employees before they can apply to receive JobKeeper Payments.

Originally, a concession was available that allowed employers to make the payments for JobKeeper fortnights 1 and 2 by 26 April 2020 (being the end of fortnight 2). The ATO then extended this to 30 April 2020.

However, under this new announcement, a further extension has been granted until 8 May 2020 providing employers with additional time to ensure they have paid each eligible employee $3,000 for JobKeeper fortnights 1 and 2.

Enrolment for the JobKeeper Subsidy has also been extended to 31 May 2020.

As a warning, employers must be aware that, despite the fact they can now pay their employees as late as 8 May 2020 and still be eligible for JobKeeper Payments for fortnights 1 and 2, they are still required to pay their employees a further $1,500 by 10 May 2020 in relation JobKeeper fortnight
3 (which ends on the same date). At the current time, no extension to this date has been announced, and it would be unwise for employers to anticipate that there will be one.

Reference can also be made to the following:

Assistant Treasurer’s media release
https://ministers.treasury.gov.au/ministers/michael-sukkar-2019/media-releases/jobkeeper-
payment-extension-help-business-cashflow-0

20 April 2020 – JobKeeper Enrolment and Eligibility

The Government has now passed legislation with regards to the JobKeeper program and how this application process will be rolled out to eligible businesses.

Enrolments opened on Monday 20th April 2020.

The JobKeeper payment will be available in fortnightly payments between 30 March 2020 and 27 September 2020.  Payments to eligible businesses will be made in arrears commencing from the first week of May 2020.

On this page:

  1. How to Enrol for the JobKeeper Payment (available from 20 April 2020) 
  2. Confirming eligible employees you will claim the JobKeeper payment for (available from 4 May onwards)
  3. What you need to do for your employees

Key Dates:

  • From 20 April: enrol for JobKeeper payment.
  • Pay your employees the minimum of $1,500 per fortnight by 8 May to claim JobKeeper payments for April.
  • 4 May onwards: identify your employees.
  • Each month: reconfirm eligibility.
  • If you need more time, you have until the 31st May to enrol and identify your employees for the first two JobKeeper fortnights.

Enrol for the JobKeeper payment

You or a registered tax professional can enrol for the JobKeeper payment as from 20 April 2020 (has now been extended to 31 May 2020):

Step 1 – Check your business and your employees meet the following eligibility conditions

Employers will be eligible for the JobKeeper payment if all of the following apply:

On 1 March 2020, you carried on a business in Australia or were a not-for-profit organisation that pursued your objectives principally in Australia.

You employed at least one eligible employee on 1 March 2020.

Your eligible employees are currently employed by your business for the fortnights you claim for (including those who are stood down or re-hired).

Your business has faced a

  • 30% fall in turnover (for an aggregated turnover of $1 billion or less)
  • 50% fall in turnover (for an aggregated turnover of more than $1 billion), or
  • 15% fall in turnover (for ACNC-registered charities other than universities and schools).

Sole Traders and other entities such as Partnerships and Trusts may also be eligible to apply as an Eligible Business Entity and it satisfies the following:

  • on 1 March 2020, it carried on a business in Australia
  • it satisfies the fall in turnover test for the relevant period
  • it satisfied certain conditions as at 12 March 2020, being:
    • it had an ABN on 12 March 2020, and
    • it had lodged, on or before 12 March 2020, at least one of
      • a 2018–19 income tax return showing that it had an amount included in its assessable income in relation to it carrying on a business, or
      • an activity statement or GST return for any tax period that started after 1 July 2018 and ended before 12 March 2020 showing that it made a taxable, GST-free or input-taxed sale.
    • Note: A discretion to give further time after 12 March 2020 may apply in limited circumstances. More information will be available soon.

 Your business is not in one of the ineligible categories.

You should note that the turnover calculation is based on GST turnover, but there are some modifications, including disregarding GST grouping where two or more associated business entities operate as a single GST group.

Employees will be eligible if all of the following conditions are met as at 1 March 2020:

The person was at least 16 years of age;
The person was either:

  • An Employee other than a casual employee:
  • A long term casual employee, employed on a regular and systematic basis for the 12 months up to 1 March 2020

The person was either:

  • An Australian resident (within the meaning of s.7 of the Social Security Act 1991): or
  • An Australian resident for tax purposes and held a Subclass 444 (Special Category) Visa.
  • An eligible individual non-employee

Note: Australian resident as at 1 March 2020 within the meaning of the Social Security Act 1991, which requires that they reside in Australia, and are one of an Australian citizen, the holder of a permanent visa, or a Protected Special Category Visa Holder. More information about these requirements can be found from the Services Australia website under residence descriptionsExternal Link. Your employee can also be an Australian tax resident who is a Special Category (Subclass 444) Visa Holder. Employees who are not permanent residents of Australia must notify you of their visa status to allow you to determine if they are eligible.

You cannot claim for any employees who either:

  • were first employed by you after 1 March 2020
  • left your employment before 1 March 2020
  • have been, or have agreed to be, nominated by another employer.

Casual employees are only eligible if they were employed by you on a regular and systematic basis for at least 12 months at 1 March 2020.

Step 2 – Employers will have to pay eligible employees a minimum of $1,500 (before tax) per fortnight to claim the JobKeeper Payment as from 30th March 2020.

This is pay period is now termed the JobKeeper fortnight – the first JobKeeper fortnight is the period from 30 March to 12 April with the final fortnight ending on 27 September 2020.

If employers do not continue to pay their employees for each JobKeeper pay period, they will cease to qualify for the JobKeeper payment.
 
Step 3 – Notify your eligible employees that you are intending to claim the JobKeeper payment on their behalf and check they aren’t claiming JobKeeper payment through another employer or have nominated through another business.

Step 4 – Send a JobKeeper Employee Nomination Notice  (Link to Form) to your nominated employees to complete and return to you by the end of April if you plan to claim JobKeeper payment for April. Keep it on file and provide a copy to your registered tax agent if you are using one.

Step 5 – From 20 April 2020, you can enrol with the ATO for the JobKeeper payment using either your Business Portal or via your Registered Tax Agent, or by contacting the ATO direct.

Step 6 – Completing the online form:
–  Confirm if you are a charity or Not-for-profit
–  Does your aggregated turnover exceed $1 billion dollars per annum?
–  Which month the turnover has reduced by the necessary %
–  Has the turnover for the entity fallen or is likely to fall by the required % or more?
–  Are you intending to enrol as an eligible business participant? –  If you do not have any employees and the answer is Yes then in next section where you are required to detail the  number of JobKeeper eligible employees paid during April this will be zero for both fortnights
–  If you have employees you will put the number of employees you are intending to claim for in both fortnightly periods.
–  Enter in the bank account details for which the JobKeeper subsidy is to be paid to.
–  Enter in your contact details and submit the form.
 
Confirmation of eligible employees you will claim JobKeeper Payment for (available from 4 May 2020 onwards)

You or a registered tax agent can apply for the JobKeeper payment for your eligible employees:

Step 1 – Apply to claim the JobKeeper payment by logging in to your business portal (ATO Business PortalExternal Link) or via your registered Tax Agent or other method available to you after first registering.

Step 2 – Ensure you have paid each eligible employee a minimum of $1,500 per JobKeeper fortnight before tax.

Step 3 – Identify your eligible employees in the application form by

  • selecting employee details that are prefilled from your STP pay reports if you report payroll information through an STP enabled payroll solution, or
  • manually entering employee details in ATO online services or the Business Portal if you do not use an STP enabled payroll solution, or
  • using a registered tax agent who will submit a report on your behalf through Online services for agents. 

Step 4 – Submit the confirmation of your eligible employees online and wait for the confirmation screen.

Step 5 – Notify your eligible employees you have nominated them.

Step 6 – The ATO will pay you the JobKeeper payment for all eligible employees as from the first week of May 2020.

Step 7 – Each month, you will need to reconfirm that your reported eligible employees have not changed through ATO online services, the Business Portal or via your registered tax agent. This will ensure you will continue to receive the JobKeeper payments. 

Businesses will need to provide business activity statements and other documents to support their claims.

Information must also be provided about current and projected GST turnover throughout the six month period the subsidy payments will last. This will be done in your monthly JobKeeper Declaration report.

This data won’t be used to re-test eligibility. The ATO says it wants an “indication of how your business is progressing under the JobKeeper Payment scheme”.

Step 8 – If your eligible employees change or leave your employment, you will need to notify the ATO via your monthly JobKeeper Declaration report.

If you use the ATO Business Portal, you will need a myGovID linked to your ABN in relationship Authorisation Manager (RAM). You can find out how to set this up at ato.gov.au/mygovid

What do you need to do for your employees

You need to identify which employees you intend to claim the JobKeeper payment for and tell them you intend to claim the JobKeeper payment for them.

You need to provide these employees with the JobKeeper employee nomination notice and ask them to return it to you by the end of April if you want to claim JobKeeper payment for April.(Link to Form provided previously)

If your employees have multiple employers, they can usually choose which employer they want to nominate through. However, if your employees are long-term casuals and have other permanent employment, they cannot nominate you. They cannot receive the JobKeeper payment from more than one employer.

If an employee is currently receiving an income support payment, they must notify Services AustraliaExternal Link of their new income to avoid incurring a debt that they will have to repay.

If you have any queries please do not hesitate to contact our office.

ATO website
https://www.ato.gov.au/general/JobKeeper-Payment/