Like share us on facebook

Latest Posts

Some key date coming up for October and November. Also more JobKeeper reminders.

I know you have probably been bombarded with information on...

Continues...

The COVID-19 Pandemic has forced business to restructure their affairs and adapt to the new landscape. Government too has the opportunity to...

Continues...

As part of the federal Government’s JobMaker Plan, announced in the budget, eligible companies will temporarily be able to carry back tax loss. This...

Continues...

JOBKEEPER APPLICATION PROCESS

The ATO have now provided updated information on the JobKeeper program. Enrolments to the program will be open from Monday the 20th of April. Prior to enrolling, you should:

 

 

 

  • Ensure you meet the eligibility criteria
  • Notify all eligible employees that you are intending to claim the Jobkeeper payment on their behalf and have them complete a “JobKeeper Employee Nomination Notice”.
  • Continue to pay each eligible employee a minimum of $1,500 per fortnight

 

Eligibility Criteria

For businesses with employees, you generally need to have faced a 30% fall in turnover relative to the same period last year.  To be eligible for the first fortnight of JobKeeper, starting on 30 March 2020, you can compare either of the following:

  1. GST turnover for March 2020 with GST turnover for March 2019
  2. Projected GST turnover for April 2020 with GST turnover for April 2019
  3. Projected GST turnover for the quarter starting April 2020 with GST turnover for the quarter starting April 2019.

 

The Commissioner has announced that alternative tests will be introduced, but no details of these are available at the time of writing.

 

Notify Eligible Employees

To be eligible for the JobKeeper payment, you must include all eligible employees in the application process.  This includes employees who would ordinarily receive less than $1,500 per fortnight pay. Eligible employees are:

  • Currently employed by you (including those re-hired/stood down), who were either full time or permanent part-time, or a casual employed on a regular basis for 12 months as at 1 March 2020.
  • At least 16 years of age on 1 March 2020
  • Australian residents as at 1 March 2020, or holder of specific Visa classes
  • Not in receipt of government parental leave or Dad and partner pay during the JobKeeper fortnight
  • Not in receipt of a payment in accordance with Australian worker compensation law for an individual’s total incapacity for work
  • Not in receipt of a JobKeeper payment from any other employer

 

You must notify each eligible employee that you intend to nominate them as eligible employees under the JobKeeper scheme, and they must agree to be nominated by completing the JobKeeper employee nomination notice available here www.ato.gov.au/Forms/JobKeeper-payment---employee-nomination-notice/

 

You must hold a copy of the completed notice for a minimum of 5 years.  Failure to do this, or to hold other records during the period will result in a total loss of entitlement to the JobKeeper Scheme.

 

Pay Employees a minimum of $1,500 per fortnight

You must pay a minimum of $1,500 Gross per fortnight to all of your eligible employees.  This must be paid to your employees in your regular payroll cycle to continue to be eligible for the JobKeeper payment.  That is, you must pay your employees in advance, before receiving a refund from the Tax Office the following month.  For the month of April, the ATO will be satisfied that you have complied with this obligation provided all eligible employees have received $3,000 of gross pay for the month, by 30 April.

 

For those employees who are still actively engaged in the business, and earning more than $1,500 gross per fortnight, nothing will change.  You will continue to pay them their ordinary pay, plus super and other entitlements.  The $1,500 per fortnight that you receive will essentially subsidise that pay. 

 

For those employees who would ordinarily earn less than $1,500, or for those earning less than $1,500 because their hours have been reduced, or they have been stood down, you must pay the full $1,500 to them each fortnight, after deducting the relevant withholding tax.  Superannuation will accrue on any part of that $1,500 that was earned by the employee, whilst any top up amount that you pay to get up to the $1,500 will not require superannuation.  Entitlements for sick and annual leave will continue to accrue for permanent employees.

 

Business Owners

If you operate your business through a company or trust structure, and pay yourself a wage, you will be an eligible employee for the JobKeeper Scheme.  If you don’t pay yourself a wage, or you are a partner in a partnership, or a Sole Trader, you can also apply for the JobKeeper Payment scheme under the business participation entitlement.  To be eligible for this scheme you need to:

  • Have a non-employee individual who is actively engaged in the operation of the business. This person will be the “eligible business participant”.
  • Meet the other relevant eligibility requirements

 

Only one eligible business participant per entity can apply, regardless of how many working owners there are, who don’t draw an official wage.  If eligible, the entity, not the individual, receives the payment, except for Sole Traders, who are in essence the same person, and receive the JobKeeper payment themselves.  There is no requirement for the JobKeeper payment to be paid to the eligible business participant, as either wages, drawings, dividends or distributions.

 

To be classified as an “Eligible Business Participant”, you must meet all of the following tests:

  • They are an individual not employed by your entity
  • They are actively engaged in the business carried on by your entity at 1 March 2020 and for the fortnight you are claiming.
  • They are one of the following at 1 March 2020 and for the fortnight you are claiming:

    • A sole trader
    • A partner in the partnership
    • An Adult beneficiary of the trust
    • A Shareholder or Director in the company

  • As at 1 March 2020 they are at least 16 years of age and an Australian Resident or other specific visa holder
  • They are not currently receiving government parental leave pay or dad & partner pay
  • They are not currently totally incapacitated for work and receiving payments under an Australian works’ compensation law in respect of your total incapacity to work
  • They are not an employee (other than casual employee) of another entity
  • They have given you a JobKeeper nomination notice, and not given another entity a JobKeeper nomination notice.

 

There will be further notification conditions which you will need to meet, but as at the time of writing these are unavailable.

 

Enrolment Process

Once you have checked your eligibility, and notified all employees, you can enrol for the JobKeeper payment from 20 April.  You can do this using the Business Portal (you will need to authenticate using myGovID), or we can lodge this for you through the Tax Agent Portal.  You will need to nominate your bank details and also specify the estimated number of employees who will be eligible for the first and second JobKeeper fortnights (30 March – 12 April, and 13 April – 26 April).  If you intend to claim for the first or second JobKeeper fortnights, you must enrol by the end of April.

 

Claim Process

From the 4th of May 2020 onwards, you will be able to claim the JobKeeper payment by logging in to the Business Portal (again we can also do this for you via the Tax Agent Portal).  As part of the claim process, you will need to ensure you have paid each eligible employee a minimum of $1,500 per fortnight before tax.  You will be able to identify your eligible employees in the application form by selecting them from a prefilled list if you use Single Touch Payroll (STP), or by manually entering the employee details.  Each month you will need to reconfirm that your reported eligible employees have not changed.  You will also be required to provide some information in relation to your current and projected turnover, but you will not be required to retest your reported fall in turnover.

 

At first this will be a complicated process, especially in relation to calculating eligibility of employees, particularly for those who are casuals and have multiple employers.  Likewise, businesses with multiple business structures may need to rely on an alternative test to show the drop in revenue.  If you have any questions at all in relation to this program, we would encourage you to get in touch with your advisor.