16 Apr JobKeeper Payment Update
The Federal Government has now passed legislation and accompanying rules that govern how the $1,500 / fortnight JobKeeper payments will work.
At dnm group we are committed to bring you all the latest information in regard to the new Jobkeeper scheme. Below is a summary of the most asked questions from clients.
Also for your information we have loaded the latest Coronavirus Economic Response Package onto our website for your reference.
If you still need assistance in regard to the Jobkeeper scheme please contact our office.
• The Jobkeeper scheme starts on 30 March 2020 and ends on 27 September 2020 (being 13 fortnights)
• Eligible businesses that have suffered a substantial decline in turnover can be entitled to a Jobkeeper payment of $1,500 per fortnight for each eligible employee.
• Businesses must have paid salary and wages of at least $1,500 to the employee in the fortnight.
• A business can also be entitled to a Jobkeeper payment of $1,500 per fortnight for one business participant (for example an owner who is not an employee) who is actively engaged in operating the business.
• The ATO must make the Jobkeeper payments to businesses within 14 days after the end of each calendar month, for fortnights ending in that prior month.
How often will JobKeeper payments be made?
JobKeeper payments will be made in respect of fortnightly periods, known as a JobKeeper fortnight, commencing on 30 March 2020.
Does an employer need to register to receive JobKeeper payments?
Yes. The JobKeeper scheme requires an employer to actively seek to participate in the scheme. Registration must be completed using an approved form from the Commissioner which will be available from 20 April 2020.
What are the transitional rules for JobKeeper fortnights during the month of April 2020?
Whilst employers will only be entitled to JobKeeper payments from the fortnight in which they are registered, for the month of April 2020 employers who register prior to the end of April will be entitled to the JobKeeper payments for the two JobKeeper fortnights commencing from 30 March 2020. Entitlement will be on the basis that the employer meets the eligibility criteria to qualify for the payments.
What is a JobKeeper fortnight?
The first fortnight is the fortnight beginning on 30 March 2020; and
each subsequent fortnight, ending with the fortnight ending on 27 September 2020.
What JobKeeper payments will an Employer be entitled to?
An Employer will be entitled to be paid a JobKeeper payment in a fortnight if:
• The fortnight is a JobKeeper fortnight
• The employer qualifies for the scheme on or before the end of the fortnight
• The payment is for an eligible employee
• The employer satisfied the wage condition by making payments to the eligible employees; and
• The employer has notified the Commissioner of the relevant information
How does an Employer qualify for the JobKeeper scheme?
To qualify for the scheme an employer must satisfy the following requirements:
• On 1 March 2020 it carried on a business in Australia or was a non-profit body pursuing its objectives principally in Australia.
• Before the end of the fortnight it met the decline in turnover test; and
• Not be subject to the Major Bank Levy, not a government body or be subject to a liquidation, administration or bankruptcy action during the relevant fortnight.
How much does turnover need to decline by?
A business will satisfy the turnover test where the shortfall in its turnover between the comparable periods is 30 percent or more. This test applies to businesses with a turnover of less than $1 billion.
Larger businesses need to have a greater decline in turnover to satisfy the turnover test with the shortfall in turnover needing to be 50 percent or more.
How is the turnover test applied?
There are two ways in which a business can satisfy the decline in turnover test. These are the basic test and the alternative test.
Who is an eligible employee?
An eligible employee of an employer for a JobKeeper fortnight is a person who satisfies the relevant criteria at two specific points in time.
The first set of criteria must be met at 1 March 2020 to ensure that the JobKeeper payments are limited to employees who were employed by the entity before any impact of coronavirus was experienced. An employee who satisfies the following will be an eligible employee as at 1 March 2020:
• The person was 16 years or over
• The person was employed other than as a casual employee of the employer or if employed as a casual was so for a period of greater than 12 months prior to 1 March 2020
• The person was an Australian resident or was a resident of Australia for tax purposes and holds a Subclass 444 (Special category) visa.
The second set of criteria must be met at any time in a relevant JobKeeper fortnight by each eligible employee.
• The person is an employee of the employer
• The person is not excluded from being an eligible employee, meaning they are not a recipient of parental leave pay or workers compensation.
In addition to the above criteria the eligible employee must have provided a notice to their employer agreeing:
• To be nominated by the employer as an eligible employee
• Confirming they have not agreed to be nominated by another employer
• They do not have permanent employment with another employer if they are employed as a casual with this employer.
Please note if you are an employer and wanting to claim JobKeeper payments dnm group can help assist with your application on your behalf from Monday the 20th of April. Please contact us to discuss fee package options that suit your unique needs.
Still want more information on the Jobkeeper?
The ATO website has published very detailed information on how the JobKeeper scheme works for employers, employees and tax professionals. You can find more information HERE