What has changed and how does it affect you?
The legislation to extend JobKeeper and the Treasurers update to the Scheme came through on the 15th of September. We have listed the details below and a quick 6-minute update video presented by Andrew Pearce, Head of Client Services. If your organisation has been a recipient of JobKeeper Payments or you have more recently experienced a drop in income, we encourage you to watch the video or read the details below.
1st Extension Period
Begins 28 September 2020 and ends 3 January 2021.
Full rate = $1,200
Partial rate = $750
To receive JobKeeper, your business must show a 30% decline in revenue from the September quarter (July, August, September 2020) in reference to the same time last year.
Must be on actual turnover and not projected - this is what was reported on your BAS.
2nd Extension Period
Begins 4 January 2021 and ends 28 March 2021.
Full rate = $1,000
Partial rate = $650
To receive JobKeeper, your business must show a 30% decline in revenue from the December quarter (October, November, December) in reference to the same time last year. Must be on actual turnover and not projected - this is what is reported on your BAS.
Employer Eligibility Assessment - 1 October 2020 and 1 January 2021
Monthly JobKeeper Declaration Report - Due by 7th of Each Month
– Reconfirm that your reported eligible employees have not changed
– Input required ATO declaration items
– Notify if any eligible employees have changed or left your employment
For Employees
Employees who were employed on or before July 1 2020 are now eligible for JobKeeper if your business meets the requirements. Lower JobKeeper payments apply to employees who work less than 80 hours during a specified 28 day period. You need to nominate which employee wi;; receive this lower rate, then notify them of this within 7 days of making the nomination.
Employee Eligibility
Must satisfy:
An employment test (full-time, part-time, or casual employee)
<
Be 18 years or older, unless legally independent or not studying full time
Be an Australian resident (at the relevant date)
These eligibility criteria can be tested from 1 July 2020, extending JobKeeper to employees who have been with an employer since the scheme was introduced.
Employees who were tested under JobKeeper 1.0 do not need to be tested again.
Payment Tiers
Tier 1:
Total hours of work, paid leave and paid absence on public holidays in the reference period > 80 hours
Tier 2: Total hours of work, paid leave and paid absence on public holidays in the reference period < 80 hours
Employers must notify the Commissioner which payment rate each employee is receiving, as well as notifying the employee of their rate within 7 days.
Reference Period
The two-tier payment system applies to employees based on their total hours in the 'reference period'.
Either:
- the 28-day period ending at the end of the most recent pay cycle for the employee that ended before 1 March 2020; or
- the 28-day period ending at the end of the most recent pay cycle for the employee that ended before 1 July 2020
Where the pay cycle for an employee is longer than 28-days, a pro-rata proportion of the total hours of work, paid leave and paid absence on public holidays of the employee in the pay cycle is to be used in determining whether the individual has met the work hours test.
For employers
You are not required to have been enrolled in the JobKeeper 1.0 scheme to enroll in JobKeeper 2.0. However, the original decline in turnover test as part of JobKeeper 1.0 must still be satisfied. If you are applying for JobKeeper 2.0, you are likely able to meet this requirement.
Employer Obligations
From 28 September businesses will need to apply a new actual decline in turnover test in addition to the existing decline in turnover test.
GST turnover from Sept 2020 quarter < GST turnover from Sept 2019 quarter
GST turnover from Dec 202 quarter < GST turnover from Dec 2019 quarter
Regardless of your businesses' BAS reporting cycle, the required turnover test must be completed for the above listed quarters.
Depending on the size of your business, you must prove that your business has a 15%, 30%, or 50% reduction in actual GST turnover for the quarters.
Service Entities
The modified test (section 8A of the Rules) remains available for service entities in its current form (i.e. for entities in GST, consolidated or consolidatable groups). Entities will need to reconsider the key conditions of this test for the September and December 2020 quarters, such as whether the entity supplies employee labour services to group members that have making supplies to third parties as their principal activity and that the employer does not itself supply employee labour services to entities outside the group (other than incidental amounts).
The Commissioner
The Commissioner may determine that certain supplies or classes of supplies are to be treated as being wholly or partly made at a particular time. The Explanatory Statement notes that it is expected the Commissioner will determine that most or all supplies will be treated as being made at a time in the period to which they are attributable for GST reporting purposes — i.e. it is likely that businesses will generally be able to assess eligibility based on details reported in their Business Activity Statement (BAS). The Commissioner may determine that an alternative reference period applies to a specified class of individuals where he considers that the relevant reference period set out above may not be suitable.
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