JobKeeper Payment Scheme Extension

JobKeeper Payment Scheme Extension

The purpose of this Fact Sheet is to enable you to make a quick assessment of your eligibility for the Government’s JobKeeper Payment Scheme extension beyond the original end date of 27 September 2020. If, after you have examined the information in this Fact Sheet and believe that you may be eligible, please contact us immediately so we may assist you further.

The original JobKeeper Payment scheme (the Scheme) was announced on 30 March 2020 by the Prime Minister and the Treasurer. The purpose of the Scheme is to keep people employed even though the business they work for has suffered a downturn including a ‘hibernation’ or close down for a temporary period. The Scheme was to run from Monday 30 March 2020 to Sunday 27 September 2020

The JobKeeper extension (JobKeeper extension) was announced on 21 July and will extend the scheme until 28 March 2021.  Further refinements were announced by the Treasurer on Friday 7th August 2020 mainly as a result of the Victorian Stage 4 Restrictions.

The original scheme enabled eligible employers to claim a fortnightly payment of $1,500 per eligible employee from 30 March 2020, for a maximum period of 6 months.  The extension of the scheme will see a more targeted and tapered approach with a two-tier wage subsidy and two additional JobKeeper periods of three months each.

What’s new?

From Monday 3 August 2020:

  • the employee eligibility test date will move from 1 March 2020 to 1 July 2020. The new reference date will apply for the last four fortnights of the originalscheme as well as the duration of the extended period. Staff who were hired after 1 March 2020 may now be eligible for JobKeeper.

From 28 September 2020:

  • a two-tier payment rate will apply based on the worker’s working hours
  • the current $1,500 per fortnight payment rate will be reduced on 28 September 2020 and reduced further on 4 January 2021
  • the decline in turnover will be retested on a quarterly basis, and
  • the decline in turnover test will be based on actual GST turnover.

From 28 September 2020 to 3 January 2021, the JobKeeper Payment rates will be:

  • $1,200 per fortnight for all eligible employees and for eligible business participants who were working for more than 80 hours or more in the 28 days before the end of the most recent pay period ending before 1 March 2020 or for all eligible employees who were working for more than 80 hours or more in the 28 days before the end of the most recent pay period ending before 1 July 2020, 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 and for business participants who were working for more than 80 hours or more in the 28 days before the end of the most recent pay period ending before 1 March 2020 or for all eligible employees who were working for more than 80 hours or more in the 28 days before the end of the most recent pay period ending before 1 July 2020; and
  • $650 per fortnight for other eligible employees and business participants.

Is your business eligible for your employees in the extension period(s)?

An employer is entitled to the JobKeeper payment in respect of an individual (an employee) in relation to an extension period if it meets the revised eligibility rules.

Decline in turnover Test

Decline in turnover test

From 28 September 2020, businesses seeking to claim the JobKeeper payment will be required to demonstrate that they have suffered an actual decline in turnover using actualGST turnover (rather than projected GST turnover).   The ATO has provided guidance that, for most businesses,actual GSTturnover will be the accounting basis used for GST reporting purposes.

From 28 September 2020, businesses will be required to reassess their eligibility with reference to their actual GST turnover in the September quarter 2020 to be eligible for the JobKeeper Payment from 28 September 2020 to 3 January 2021 (the first extension period).

From 4 January 2021, businesses will need to further reassess their turnover to be eligible for the JobKeeper Payment. They will need to demonstrate that they have met the relevant decline in turnover test with reference to their actual GST turnover in the December quarter 2020 to be eligible for the JobKeeper Payment from 4 January 2021 to 28 March 2021 (the second extension period).

For the first extension period, businesses will need to demonstrate that their actualGST turnover has fallen in the September quarter 2020 (July, August, September) relative to a comparable period (generally the corresponding quarter in 2019).

For the second extension period businesses will need to demonstrate that their actual GST turnover has fallen in the December quarter 2020 (October, November, December) relative to a comparable period (generally the corresponding quarters in 2019).

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 discretions for the original scheme.

How much does my actual decline in turnover need to be?

Aggregated turnover was > $1 Billion

50%

Aggregated turnover was <$1 Billion

30%

Eligible employees

Employees are eligible in the extension period if they:

  • are currently employed by an eligible employer (including if you were stood down or rehired)
  • 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 July 2020; 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 you were 16 or 17 you can also qualify if you are independent or not undertaking full time study).
  • an Australian resident.

Some employees are not eligible if they receive certain forms of Government assistance.

Wage condition

You satisfy the wage condition in respect of an employee for a JobKeeper fortnight in the extension period where their gross paywill exceedthe relevant JobKeeper rate.

From 28 September 2020 to 3 January 2021, the JobKeeper Payment rates will be:

  • $1,200 per fortnight for all eligible employees who were working for more than 80 hours or more in the 28 days before the end of the most recent pay period ending either before 1 March 2020 or 1 July 2020, and
  • $750 per fortnight for other eligible employees.

From 4 January 2021 to 28 March 2021, the JobKeeper Payment rates will be:

  • $1,000 per fortnight for all eligible employees who were working for more than 80 hours or more in the 28 days before the end of the most recent pay period ending either before 1 March 2020 or 1 July 2020, and
  • $650 per fortnight for other eligible employees.

The Commissioner of Taxation will have discretion to set out alternative tests where an employee or business participant’s hours were not usual during the Februaryand/orJune 2020 reference period (the period with the higher number of hours worked is to be used for employees with 1 March 2020 eligibility).

Guidance hasbeen provided by the ATO where the employee was paid in non-weekly or non-fortnightly pay periods and in other circumstances the general rules do not cover.

The JobKeeper Payment will continue to be made by the ATO to employers in arrears. Employers will continue to be required to make payments to employees equal to, or greater than, the amount of the relevant JobKeeper Payment (before tax), based on the payment rate that applies to each employee.

You are required to give information about the entitlement for the fortnight, including details of the individual and the relevant rate, to the Commissioner, in the approved form.

Important  – Action Required by 31 October 2020

You must meet the wage condition for the first two fortnights (commencing 28 September and 12 October) by 31 October 2020.  That is you must ensure you pay the relevant rate to your employees before 31 October 2020.

The following questions are intended to assess eligibility for the Extension to the JobKeeper Scheme.

Eligibility Criteria

Employer Conditions

Yes

No

Was my business being carried on 1 March 2020?

   

Has my actual GST Turnover declined by the required percentage?

(Turnover >$.1 billion -50%
Turnover < $1 billion – 30%)

   

Notification -I have or I will advise the ATO on the approved form of my intention to participate in the extended JobKeeper Scheme?

   

Is the fortnight a JobKeeper fortnight?
(28September 2020 – 3 January 2021 – first extension)
(4 January 2021 to 28 March 2021 – second extension)

   

I have or I will provide the ATO with information in the approved form?

   

Employee Conditions -Was my employee?

   

Employed at any time in the fortnight?

   

At 1 March 2020 and or 1 July 2020
            Aged 16 or over?

   

            Full or part time? or
            Long term Casual Employee (> 12 months)?

   

            Australian Resident?

   

The Employee has agreed to be nominated and has or will provide me with notification?

   

Wages Condition
Have I paid my employee Gross Payat the relevantJobKeeper Rate for the relevant fortnight?

   

Full Rate
Did my employee work for 80 or more hours in the 28 days before the end of the final pay cycle before 1 March 2020 or 1 July 2020?

(If NO part rate applies)

   

Not Opted Out
You have NOT notified the ATO that you no longer want to participate?

   

If you have answered “yes” to ALL of the above you may qualify for the JobKeeper Payments from the ATO.  We can assist you in confirming your eligibility and completing all necessary forms.  Please contact us as a matter of urgency.

If you have answered any question “No”, you are unlikely to qualify for the JobKeeper Payment Scheme.

Business Participant Eligibility

Entity Requirements

Yes

No

Was my entity carrying on business on 1 March 2020?

   

Has my actual GST Turnover declined by the required percentage?

(Turnover >$.1 Billion  -50%
Turnover < $1 Billion – 30%)

   

Is the fortnight a JobKeeper fortnight?
(28September 2020 – 3 January 2021 – first extension)
(4 January 2021 to 28 March 2021 – second extension))

   

Have I provided the ATO with information in the approved form?

   

Individual – Business Participant Requirements

   

The individual was actively engaged in the business at any time in the fortnight?

   

The Individual is a relevant Business Participant

If a Sole trader the sole trader
If a Partnership – a partner
If a Trust – an adult beneficiary of the trust
If a Company – a Shareholder or Director

   

At 1 March 2020
            Aged 18 or over?

   

            Full or part time? or
            Long term Casual Employee (> 12 months)?

   

If aged 16 or 17, they are independent or not undertaking full time study

   

            Australian Resident?

   

The individual has agreed to be nominated and providedthe entity with notification?

   

Full Rate?
Was the individual actively engaged in the business for 80 or more hours in the 29 days before 1 March 2020?
(If NO part rate applies)

   

Has the Entity satisfied the integrity Rule?

   

If you have answered “yes” to ALL of the above you may qualify for the JobKeeper Payments from the ATO.  We can assist you in confirming your eligibility and completing all necessary forms.  Please contact us as a matter of urgency.

If you have answered any question “No”, you are unlikely to qualify for the JobKeeper Payment Scheme.

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