We simplified the following outline from the government fact sheet released 21 July 2020, regarding the Jobkeeper extension.
JobKeeper Extension Explained
The Australian Government announced on 21 July 2020 an extension to the JobKeeper program until 28 March 2021.
WARNING NOTE: The following information comes from the Australian Government – Treasury outlining the Government’s response. The following response must still pass legislation through Parliament before becoming legal. Please speak to us at Bishop Collins before taking any action, and for more information and clarity on how this will affect your business.
The JobKeeper Payment Rate
The JobKeeper Payment, which was originally due to run until 27 September 2020, will now continue to eligible businesses (including the self-employed) and not-for-profits until 28 March 2021,
From 28 September 2020 to 3 January 2021, the JobKeeper Payment rates will be:
- $1,200 per fortnight for all eligible employees and business participants who were working in the business or not-for-profit for 20 hours or more per week on average in the month of February 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 business participants who were working in the business or not-for-profit for 20 hours or more per week on average in the month of February 2020; and
- $650 per fortnight for other eligible employees and business participants.
The Commissioner of Taxation will have discretion to set out alternative tests where an employee’s or business participant’s hours were not usual during the February 2020 reference period.
For example, this will include where the employee was on leave, volunteering during the bushfires, or not employed for all or part of February 2020.
Additional Turnover Tests
From 28 September 2020, businesses and not-for-profits will be required to reassess their eligibility with reference to their actual GST turnover (rather than projected GST turnover) in the June and September quarters 2020 to be eligible for the JobKeeper Payment.
From 4 January 2021, businesses and not-for-profits will need to further reassess their turnover with reference to their actual GST turnover in each of the June, September and December quarters 2020 to be eligible for the JobKeeper Payment.
To be eligible for JobKeeper Payments under the extension, businesses and not-for-profits will still need to demonstrate that they have experienced a decline in turnover of:
- 50 percent for those with an aggregated turnover of more than $1 billion;
- 30 percent for those with an aggregated turnover of $1 billion or less; or
- 15 percent for Australian Charities and Not for profits Commission-registered charities (excluding schools and universities).
Other Noteable POints Regarding JobKeeper Extension
- The Commissioner of Taxation will have discretion to extend the time an entity has to pay employees in order to meet the wage conditions, so that entities have time to first confirm their eligibility for the JobKeeper Payment.
- If a business or not-for-profit does not meet the additional turnover tests for the extension period, this does not affect their eligibility prior to 28 September 2020.
- The JobKeeper Payment will continue to remain open to new recipients, provided they meet the existing eligibility requirements and the additional turnover tests during the extension period.
- Other eligibility rules for businesses and not-for-profits and their employees remain unchanged. Further information on those rules is at: http://www.ato.gov.au/General/JobKeeper-Payment
For more personalised advice and recommendations, please contact us at Bishop Collins Chartered Accountants. Alternatively, email email@example.com or click on the following link: Bishop Collins