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JobKeeper 2.0 detailed information

The JobKeeper Payment scheme has been brought in to subsidise wage payments for eligible businesses affected by the COVID-19 pandemic. The scheme has been extended to March 2021. From 28 September 2020, the JobKeeper payments will be reduced to $1,200 per fortnight, they will be reduced again down to $1,000 per fortnight from 4 January 2021. Eligible businesses can be structured as sole-traders, partnerships, trusts or companies.

Payments will be made by the ATO monthly, in arrears. Payments will be scheduled to end by 28 March 2021.

Eligibility criteria

Qualifying for the scheme

For a business to qualify for the extension periods, it must:

          • have at least a 30% reduction in “actual” turnover for the September and December 2020 quarters compared to a year ago (50% reduction for businesses greater than $1b in turnover and 15% reduction for registered non-profits and Australian charities). The decline in turnover test changes after September 2020 in the following ways:

         – the turnover test is based on the business “actual” GST turnover for the relevant period. Meaning if you are GST registered you need to use your GST accounting method to determine the reduction in turnover, i.e. cash or accruals, and

         – the business must compare the September 2020 quarter, with the same quarter a year ago in order to qualify for the first extension for September to January payments, and

         – the business must compare the December 2020 quarter with the same quarter a year ago in order to qualify for the second extension for January to March payments.

          • not be subject to the Major Bank Levy

          • for JobKeeper fortnights from 3 August 2020 onwards, have an employment relationship with employees that existed as at 1 July 2020, and

          • confirm that each eligible employee is currently engaged.

For the JobKeeper extension, businesses and non-profits will generally be able to assess eligibility based on the details reported in their Business Activity Statements (BAS). The “Alternative” tests have also been extended and the qualifying criteria and calculation methods remain the same as from the initial JobKeeker scheme. Business that are not registered for GST are able to use either the cash or accruals accounting method to determine their turnover for the qualifying period but must use the same method for the comparison period.

As the September BAS is lodged by late October, and the December BAS is lodged by late February for quarterly lodgers, businesses and non-profits will need to assess their eligibility for JobKeeper in advance of the BAS deadline. They have to do this in order to meet the wage condition, which requires them to pay their eligible employees in advance of receiving the JobKeeper payments in arrears.

The Commissioner of Taxation will have discretion to extend the time an entity has to pay employees in order to meet the wage condition, so that entities have time to first confirm their eligibility for JobKeeper Payment. For the October fortnightly payment businesses will generally have until 31 October to ensure they have paid their employees the correct tire of JobKeeper payment.

NOTE: There is a chance that businesses which do not qualify for JobKeeper in the second extension — January to March 2021 — will receive a payment in February for January’s JobKeeper amount. They will not know that they are ineligible until lodgement of the December BAS on 28 February 2021. We have no further information in regards to this, apart from an acknowledgement from the ATO that a business may need to repay certain amounts.

Decline in turnover test

Business have experience a reduction in turnover for the quarter of 30% or more qualify for the first extension under the decline in turnover test, they will have to retest the next quarter in order to qualify for the second extension.

The basic test is a comparison of turnover for the quarter compared to the comparison period of a year earlier. The comparison required for a business to qualify is to compare the current GST turnover reported in the last quarter's BAS with that of the same period in the previous year. That is, comparing September 2020 and December 2020 current GST turnover with that of the corresponding September 2019 and December 2019 quarters.

Alternative tests are also available for a business who either has:

          • has only commenced operations within the past year, or

          • extraordinary circumstances.

Self-employed qualification rules

Where a person is self-employed by a business and does not receive a salary, the business may elect an “eligible business participant” for JobKeeper. Only one eligible business participant will receive JobKeeper per entity.

The individual must:

          • not be employed by the business

          • satisfy business participation requirements, and

          • satisfy nomination requirements.

Also, the individual must have a certain role in the entity to qualify, as listed below:

          • Sole trader – the individual

          • Partnership – a partner

          • Trust – an adult beneficiary

          • Company – either a director or a shareholder.

Applying for the payment

Once a business self-assesses that they qualify for the scheme, certain criteria is still required to be met in order to receive ongoing JobKeeper payments.

As stated above, the business needs to ensure which employees meet the eligibility requirements to receive the JobKeeper Payment. Exclusions apply to individuals who have been on casual employment for less than 12 months, people under 16 and those without correct residency visas.

All the eligible employees are required to be notified, in writing, that the business is intending to claim the JobKeeper Payment on their behalf. As part of this notice, the employee is required to acknowledge that they will not receive the JobKeeper payments from another employer (if necessary). The notification process includes sending the ATO’s JobKeeper employee nomination notice. This notice is required to be returned to the business before they can claim the JobKeeper amount.

Each employee is required to be paid based on the table below per fortnight (before tax) for each fortnight the business wishes to claim the JobKeeper extension.

JobKeeper Payment rate




Payment amount

First extension — 28 September 2020 to 3 January 2021

Eligible employees or business participants working for 20 hours or more per week on average during the reference period

All other eligible employees and business participants

$1,200 per fortnight

$750 per fortnight

Second extension — 4 January 2021 to 28 March 2021

Eligible employees or business participants working for 20 hours or more per week on average during the reference period

All other eligible employees and business participants

$1,000 per fortnight

$650 per fortnight


The reference period refers to the 28 day pay period immediately prior to either 1 March 2020 or 1 July 2020.

The average of the 20 hours or more per week during the reference period includes:

          • actual hours they worked

          • hours they were on paid leave, and

          • hours they were paid for absence on a public holiday.

Employees that are eligible for the 1 March 2020 reference period and are still on the payroll for the 1 July 2020 reference period, can elect to use the period with the higher number of hours worked.

As noted above, the first fortnight is 30 March 2020 to 12 April 2020. This includes re-hired or re-engaged employees, as per below.

JobKeeper Enrolment, lodgments and making changes

Employers already enrolled for JobKeeper prior to 28 September do not need to re-enrol. New employers entering the JobKeeper scheme from 28 September need to enrol and lodge their monthly declaration before 14 October.

The enrolment and management process is controlled by the ATO. Businesses can use their Tax Agent to enrol, or do it via the Business Portal and myGovID to enrol and lodge their monthly declarations.

On enrolment, each business needs to verify and identify each employee who qualifies and has nominated to receive the JobKeeper payments from the business. This can be completed from pre-filled Single Touch Payroll reports or manual pay reports (for larger employers). Employers not yet on Single Touch Payroll are able to manually enter all the eligible employee details.

Then a confirmation is required that the selected employees are still engaged by the business, and have received the minimum gross payments for each declaration period.

Each month, businesses are required to reconfirm that the employees of the business remain eligible. Therefore, businesses are required to make any subsequent changes to the employees details in the event of them leaving or changing employment.

Further actions

One main facet of the JobKeeper Payment is that the amounts paid from the ATO to the business is to be passed on to the employees. As the expense of paying employees for services is a deductible expense, the JobKeeper payments are assessable income of the business.

There are further measures in place within the updated Fair Work Act in order to protect employees. One such measure is allowing businesses to order staff to work fewer hours (including nil hours) in response to the COVID-19 pandemic.

Also, to protect employees a “minimum payment obligation” has been enacted to ensure that employees are compensated on their regular working wage. This means that employees who work less hours than normal, but entitled to earn more than the stated amount per fortnight, receive adequate compensation from their employer.


Information sourced from CCH iKnow