Last updated: 7 August 2020
Following months of speculation the Government has announced the JobKeeper Program will be extended beyond September 2020, to March 2021.
It is important to note if you currently receive JobKeeper Payments it remains unchanged until 27 September 2020.
However, to receive the new JobKeeper Payments from 28 September 2020, the eligibility will be based on actual turnover change rather than projected change which was used when businesses first applied.
- From 28 September 2020 businesses will need to reapply and pass a new test to demonstrate a 30% turnover reduction.
- To receive JobKeeper payments from 28 Sept 2020 to 3 Jan 2020 you must show a decline in GST turnover in the July – September 2020 quarter.
- To be eligible for JobKeeper payments from 4 January 2021 to 28 March 2021 payments, you must show a decline in GST turnover for the October – December 2020 quarter.
- From 28 September payment rates will drop and two tiers will be introduced:
- dropping to $1,200 per fortnight, or
- $750 per fortnight for employees working less than 20 hours a week
- From 4 January 2021 payments drop again to:
- $1,000 per fortnight, or
- $650 for employees working less than 20 hours a week
- PLEASE NOTE: new employees will be able to receive the existing payment, as well as the extension, provided they were employed as at 1 July 2020.
This update is relevant for the second round of the JobKeeper Payment from September 2020 – March 2021. For details on the current JobKeeper program from March 2020 – September 2020 please see our previous blog: https://www.afsbendigo.com.au/jobkeeper-payments-everything-you-need-to-know/
From 28 September 2020, businesses and not-for-profits seeking to claim the JobKeeper Payments will be required to demonstrate that they have suffered an ongoing significant decline in turnover using actual GST turnover (rather than projected GST turnover).
This will be based off turnover during the September 2020 quarter (July, August, September), relative to the comparable period in 2019.
To be eligible, businesses must have experienced:
- 50% decline for those with an aggregated turnover of more than $1 billion
- 30% decline for those with an aggregated turnover of $1 billion or less
- 15% decline for Australian Charities and Not-for-profits Commission-registered charities (excluding schools and universities).
Alternative arrangements will be put in place for businesses and not-for-profits that are not required to lodge a BAS.
Businesses will need to assess their eligibility for JobKeeper in advance of the BAS deadline as the deadline to lodge a BAS for the September quarter or month is in late October, and the December quarter (or month) BAS deadline is in late January for monthly lodgers or late February for quarterly lodgers.
Additional turnover tests
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 can be found at https://www.ato.gov.au/General/JobKeeper-Payment/In-detail/JobKeeper-tests/Applying-the-turnover-test/?anchor=Alternativetest#Alternativetest
The eligibility rules for employees have changed. Employees will be eligible if they:
- are currently employed by an eligible employer (including if you were stood down or rehired)
- were employed full-time, part-time or fixed-term, or a long-term casual employee (employed on a regular and systematic basis for at least 12 months) as at 1 July 2020 and not a permanent employee of any other employer.
- were aged 18 years or older at 1 July 2020 (if 16 or 17 you can also qualify if you are independent or not undertaking full time study).
- were an Australian resident 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 government parental leave or Dad and partner pay or a payment in accordance with Australian worker compensation during the JobKeeper fortnight.
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.
From 28 September 2020 to 3 January 2021, the JobKeeper Payment rates will be:
- $1,200 per fortnight for all eligible employees who worked more than 20 hours a week on average in the four weeks of pay periods before either 1 March 2020 or 1 July 2020, and for eligible business participants who were actively engaged in the business for 20 hours or more per week on average; and
- $750 per fortnight for other eligible employees and business participants.
From 4 January 2021 to 28 March 2021, the JobKeeper Payment rates will be:
- $1,000 per fortnight for all eligible employees who worked more than 20 hours a week on average in the four weeks of pay periods before either 1 March 2020 or 1 July 2020, and for eligible business participants who were actively engaged in the business for 20 hours or more per week on average; and
- $650 per fortnight for other eligible employees and business participants.
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.
If you have any questions about JobKeeper Payments and your business, client or not, please give us a call on 03 5443 0344.
For more information on other financial support available for individuals and businesses impacted by COVID-19 please see our rolling update blog: https://www.afsbendigo.com.au/round-two-covid-financial-support-need-know/