The JobKeeper scheme has been extended to 28 March 2021.
The next phase of JobKeeper is the JobKeeper extension 2 which will commence from 4 January 2021.
The criteria to receive these payments are similar to the eligibility of JobKeeper extension 1; this means the eligibility will be based on actual turnover change rather than projected turnover which could have been used when businesses applied in the first phase of JobKeeper.
Below is a summary of the guidance that has been released for the JobKeeper extension 2:
From 4 January 2021, you must:
If you do not satisfy the actual decline in turnover test you should notify your eligible employees that they will no longer receive JobKeeper payments.
If you are currently receiving JobKeeper payments and plan to continue receiving them:
For JobKeeper fortnights from 4 January 2021 you will need to meet an actual decline in turnover test. The actual decline in turnover test is similar to the original decline in turnover test, however:
The actual decline in turnover test is satisfied when your current GST turnover for the quarter ending 31 December 2020 (the months of October, November and December) has declined by the specified shortfall percentage in comparison to your actual GST turnover for the quarter ending 31 December 2019.
Businesses that were not eligible for JobKeeper extension 1 payments (28 September 2020 – 3 January 2021) may still be eligible for the JobKeeper extension 2 payments (4 January 2021 – 28 March 2021). Businesses do not need to have passed the eligibility requirements for extension 1 to be eligible for extension 2.
To be eligible, businesses must have experienced:
This will be based off turnover during the December 2020 quarter (October, November and December), relative to the comparable period in 2019.
Businesses will need to assess their eligibility for JobKeeper extension 2 by 31 January 2021 and notify the ATO using the decline in turnover test form which is available on the ATO portal.
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.
We have explained each of the alternatives available for JobKeeper extension 1 in our blog here, these tests will remain in place for the JobKeeper extension 2: www.afsbendigo.com.au/alternative-tests-for-jobkeeper-2-0/
If you do not satisfy the actual decline in turnover tests for either JobKeeper extension 1 or extension 2, you can’t claim JobKeeper payment for fortnights in the relevant extension period.
You should notify your eligible employees, eligible business participant and/or eligible religious practitioner if you are unable to claim JobKeeper payments for them. You should also advise them that you are no longer obligated to pay them an amount that is at least equal to the JobKeeper payment in those fortnights.
Your eligible employees will not be able to be nominated for JobKeeper by any other entity.
Anyone concerned about having their income reduced under JobKeeper is encouraged to investigate JobSeeker unemployment benefits.
For those whose income is reduced, they may be entitled to a part-payment on JobSeeker to top up their JobKeeper amount, dependent on asset tests and other issues.
Individuals receiving JobKeeper at the full-time rate of $1,200 or the part-time rate of $650 per fortnight might be able to receive an additional $95 or $645 respectively, in unemployment benefits, raising their incomes to $1,295.
For full details visit: How to get JobKeeper and JobSeeker.
For JobKeeper fortnights from 4 January 2021 the payment rate has been reduced and is split into two rates:
Tier 1 rate, $1,000 per fortnight (before tax) – this rate applies to:
Tier 2 rate, $650 per fortnight (before tax) – this rate applies to:
For more information on the 20 hours a week for four weeks threshold for employees please refer here: www.ato.gov.au/General/JobKeeper-Payment/Payment-rates/80-hour-threshold-for-employees/
Employers will continue to be required to make payments to employees equal to, or greater than, the amount of the JobKeeper Payment (before tax), based on the payment rate that applies to each employee.
The JobKeeper payment will continue to be made by the ATO to employers in arrears. Businesses will be required to nominate which payment rate they are claiming for each of their eligible employees.
After all employees are set, the ATO will be notified once the next Single Touch Payroll file is lodged.
For JobKeeper 2.0 the ATO has introduced a new payroll item which is included with Single Touch Payroll reports called JK-TIERX where X indicates what tier the employee falls into, and how much the payment should be.
For example, if an employee is a Tier 1 employee, the allowance item will be reported as JK-TIER1. More information about how to set this up can be found here: https://help.reckon.com/article/igzxmmgbru-adding-job-keeper-allowance-pay-items-in-reckon-accounts#jk_tierx
Do I need to include the JK-TIER items on every pay run?
No, once this has been reported for an employee, the tier for the employee has been set and you do not need to include this in every JobKeeper pay run.
You will only need to include the JobKeeper top up allowance for any employees earning under the minimum payment as required by their tier. More information on this can be found here: https://help.reckon.com/article/red06g6gpu#subsequent_pays
The eligibility rules for employees have changed. Employees will be eligible if they:
The self‐employed will be eligible to receive the JobKeeper Payment where they meet the relevant turnover test, and are not a permanent employee of another employer.
Please note: with the relevant date of employment moving from 1 March to 1 July 2020, we encourage you to review the status of any employees employed between 1 March and 1 July to see if they are now eligible for JobKeeper under both the existing scheme and the extension.
Once the appropriate rate is determined, you will need to ensure that you pay all eligible employees the minimum payments by the fortnightly dates set out by the ATO.
The payments to employees for the first two fortnights of JobKeeper extension 2 (4 January 2021 – 17 January 2021 and 18 January 2021 – 31 January 2021) need to made by 31 January 2021.
A complete list of the JobKeeper fortnights and payment due dates can be found here: https://www.ato.gov.au/General/JobKeeper-Payment/JobKeeper-key-dates/
The JobKeeper scheme will remain open to new participants, provided they meet the eligibility requirements for the relevant period. New JobKeeper participants will be required to complete employee nomination forms.
If you have any questions about JobKeeper payments and your business, client or not, please give us a call on 03 5443 0344.