On 21 July 2020 long awaited revisions to JobKeeper were finally announced, however the worsening of the economic situation in Victoria as Stage 4 coronavirus restrictions took place saw the revisions revised yet again on 7 August (and yet again later updated on 10 August – ughhh!!).
Here is a quick summary of the main points for businesses with aggregated turnover of less than $1 billion:
Extension announced:
  • The program has been extended to 28 March 2021.
  • The announcement does not have any implications for JobKeeper payments made prior to 27 September, when the program was initially set to end.

Relevant employment date revised:

  • From 3 August 2020 the relevant employment date will move from 1 March to 1 July 2020.
  • This will increase employee eligibility for the existing scheme and the extension.
  • Therefore any employees taken on between 1 March and 30 June 2020 will potentially be eligible for JobKeeper.
Rates reduced:
  • Payment rate for eligible employees and business participants, working 20 hours or more per week on average (in the 4 weeks of pay periods prior to either 1 March or 1 July 2020), will be reduced from $1,500 per fortnight to $1,200 per fortnight from 28 September and then to $1,000 per fortnight from 4 January 2021 until 28 March.
  • The payment rate for employees and business participants, working less 20 hours a week on average (in the 4 weeks of pay periods to either 1 March or 1 July 2020), will be reduced to $750 from 28 September and $650 from 4 January until 28 March.
  • The number of hours worked per week will be calculated based on the average number of hours worked weekly in February 2020.  There are alternative tests where the hours for an employee or business participant weren’t usual during that month (no further details at this stage).
  • An alternative test will be given for the number of hours worked test that applies to the months of February and June where a JobKeeper recipient was on leave, volunteering during bushfires, or not employed for all or part of February or June 2020.
 Additional turnover test:
  • To be eligible from 27 September onwards you will need to meet a further decline in turnover test.  You will need to show a 30% decline in actual GST turnover with reference to the September 2020 quarter when compared to the same quarter in 2019, to be eligible from 28 September 2020 to 3 January 2021.
  • To be eligible from 4 January onwards you will need to demonstrate a 30% decline in actual GST turnover in the  December 2020 quarter when compared to the same quarter in 2019, to be eligible from 4 January to 28 March 2021.
  • Alternative tests to assess turnover will be available.
  • Alternative tests will be in line with the current tests. We don’t have further details at this time.
  • The intention is for businesses to assess eligibility based on details reported in their business activity statements.
Wages condition continues:
  • Wage condition is the requirement to pay employees JobKeeper before receiving the JobKeeper  payment from the ATO.
  • You will need to assess your eligibility for JobKeeper in advance of the BAS deadline in order to meet the wage condition.
  • There is discretion to extend the time to pay an employee in order to meet the wages condition, so that you have time to confirm eligibility for the JobKeeper payment.
As at the time of writing this the JobKeeper extension legislation has not been passed by Parliament.  We will continue to monitor the changes to JobKeeper and provide updates through our newsletterFacebook  page and website blog.
You can access the full Extension of the JobKeeper Payment Treasury Fact Sheet here.

If you would like specific advice tailored to your business and circumstances, Accounting Heart offers affordable service packages where you can work with Sonia one-on-one to help you get on top of JobKeeper and all other aspects of your financials. Book your FREE Discovery Call to find out more.

*Only businesses with a turnover of less than $50m have been considered in this blog post.  It does not cover not-for-profits, businesses turning over more than $50m, Government bodies or businesses where a liquidator or a trustee in bankruptcy has been appointed.

 

Disclaimer: This is general information only and is not advice of any sort.  No warranty or representation is provided by Accounting Heart Pty Ltd as to the accuracy, currency or completeness of the information contained in this summary Readers of this summary should not act or refrain from acting in reliance upon any information contained herein and must always obtain appropriate taxation and / or other advice as may be appropriate having regard to their particular circumstances.