On 21 July 2020, the Government announced an extension of the JobKeeper program to 28 March 2021 but with tighter access and reduced rates. From 28 September 2020, employers seeking to claim JobKeeper payments will need to reassess their eligibility and prove an actual decline in turnover.
If your business currently receives JobKeeper, your arrangements will generally remain unchanged until 27 September 2020.
We’ve summarised the key details for employers on JobKeeper 2.0 below.
To continue receiving JobKeeper payments after 28 September 2020, employers will need to continue to meet the basic conditions of being an eligible employer and having eligible employees or business participants. However, to be eligible for further payments, they will also need to meet an additional decline in turnover test with reference to actual GST turnover.
Additional decline in turnover tests
Rather than making estimates, businesses will need to pass an actual GST turnover test as follows.
|30 March to 27 September 2020||28 September to 3 January 2021||4 January 2021 to 28 March 2021|
|Decline in turnover||Projected GST turnover for a relevant month or quarter is expected to fall by at least 30% (15% for ACNC-registered charities, 50% for large businesses) compared to the same period in 2019.*||Actual GST turnover in the June and September 2020 quarters fell by at least 30% (15% for ACNC-registered charities, 50% for large businesses) compared to the same periods in 2019. The decline for both of the quarters needs to be met to continue receiving JobKeeper payments.||Actual GST turnover in the June, September and December 2020 quarters fell by at least 30% (15% for ACNC-registered charities, 50% for large businesses) compared to the same periods in 2019. The decline for all three of the quarters needs to be met to continue receiving JobKeeper payments.|
*Alternative tests potentially apply where a business fails the basic test and does not have a relevant comparison period.
Most businesses will generally use their Business Activity Statement (BAS) reporting to assess eligibility. However, as the BAS deadlines are generally not due until the month after the end of the quarter, eligibility for JobKeeper will need to be assessed in advance of the BAS reporting deadlines to meet the wage condition for eligible employees. However, the ATO will have discretion to extend the time an entity has to pay employees in order to meet the wage condition.
The ATO 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, however there are no details released at this stage.
Employee eligibility will remain broadly the same but the value of the payment will change from 28 September based on average weekly hours in February 2020
JobKeeper Payment Amounts
|JobKeeper||30 March to 27 September 2020||28 September to 3 January 2021||4 January 2021 to 28 March 2021|
Assessing if an employee has worked 20 hours or more
JobKeeper payments from 28 September 2020 are paid at a lower rate for employees who worked less than 20 hours per week on average in the four weeks of pay periods before 1 March 2020.
The Commissioner of Taxation will have discretion to set out alternative tests for those situations where an employee’s or business participant’s hours were not usual during February 2020. Also, the ATO will provide guidance on how this will be dealt with when pay periods are not weekly.
Can I keep getting JobKeeper until September?
If your business and your employees passed the original eligibility tests to access JobKeeper, and you have fulfilled your wage requirements, you can continue to claim JobKeeper up until the last JobKeeper fortnight that ends on 27 September 2020.
ATO assistant commissioner Andrew Watson said in a recent interview, “Once you’re in, you’re in to the end of September. If you meet the eligibility test once, you’re in it for the whole time.” The original eligibility test was a once only test.
Hoffman Kelly can assist you to understand your eligibility and with the process of applying for JobKeeper. Please give your accountant a call to discuss it with them further.