JobKeeper Payment Scheme Extension
The purpose of this article is to enable you to make a quick assessment of your eligibility for the Government’s JobKeeper Payment Scheme extension beyond the original end date of 27 September 2020. It is not a comprehensive guide as the enabling legislation and rules are not yet available and the announced details may be subject to further change. If, after you have examined the information in this Fact Sheet and believe that you may be eligible, please contact us immediately so we may assist you further.
The original JobKeeper Payment scheme (the Scheme) was announced on 30 March 2020 by the Prime Minister and the Treasurer. The purpose of the Scheme is to keep people employed even though the business they work for has suffered a downturn including a ‘hibernation’ or close down for a temporary period. The Scheme was to run from Monday 30 March 2020 to Sunday 27 September 2020
The JobKeeper extension (JobKeeper extension) was announced on 21 July and will extend the scheme until 28 March 2021. Further refinements were announced by the Treasurer on Friday 7th August 2020 mainly as a result of the Victorian Stage 4 Restrictions.
The original scheme enabled eligible employers to claim a fortnightly payment of $1,500 per eligible employee from 30 March 2020, for a maximum period of 6 months. The extension of the scheme will see a more targeted and tapered approach with a two-tier wage subsidy and two additional JobKeeper periods of three months each.
What’s new?
From Monday 3 August 2020:
- the employee eligibility test date will move from 1 March 2020 to 1 July 2020. The new reference date will apply for the last four fortnights of the legislated scheme as well as the duration of the proposed extended period. Staff who were hired after 1 March 2020 may now be eligible for JobKeeper.
From 28 September 2020:
- a two-tier payment rate will apply based on the worker’s average weekly work hours
- the current $1,500 per fortnight payment rate will be reduced on 28 September 2020 and reduced further on 4 January 2021
- the decline in turnover will be retested on a quarterly basis, and
- the decline in turnover test will be based on actual GST turnover.
From 28 September 2020 to 3 January 2021, the JobKeeper Payment rates will be:
- $1,200 per fortnight for all eligible employees and for eligible business participants who were working for 20 hours or more a week on average in the four weeks of pay periods before either 1 March 2020 or 1 July 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 for business participants who were working for 20 hours or more a week on average in the four weeks of pay periods before either 1 March 2020 or 1 July 2020; and
- $650 per fortnight for other eligible employees and business participants.
Is your business eligible for your employees in the extension period(s)?
An employer is entitled to the JobKeeper payment in respect of an individual (an employee) in relation to an extension period if it meets the revised eligibility rules.
Decline in turnover Test
From 28 September 2020, businesses seeking to claim the JobKeeper payment will be required to demonstrate that they have suffered a decline in turnover using actual GST turnover (rather than projected GST turnover).
From 28 September 2020, businesses will be required to reassess their eligibility with reference to their actual GST turnover in the September quarter 2020 to be eligible for the JobKeeper Payment from 28 September 2020 to 3 January 2021 (the first extension period).
From 4 January 2021, businesses will need to further reassess their turnover to be eligible for the JobKeeper Payment. They will need to demonstrate that they have met the relevant decline in turnover test with reference to their actual GST turnover in the December quarter 2020 to be eligible for the JobKeeper Payment from 4 January 2021 to 28 March 2021 (the second extension period).
For the first extension period, businesses will need to demonstrate that their actual GST turnover has fallen in the September quarter 2020 (July, August, September) relative to a comparable period (generally the corresponding quarter in 2019).
For the second extension period businesses will need to demonstrate that their actual GST turnover has fallen in the December quarter 2020 (October, November, December) relative to a comparable period (generally the corresponding quarters in 2019).
The Commissioner of Taxation 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.
How much does my actual decline in turnover need to be?
| Aggregated turnover was > $1 Billion | 50% |
| Aggregated turnover was <$1 Billion | 30% |
Eligible employees
Employees are eligible in the extension period if they:
- are currently employed by an eligible employer (including if you were stood down or rehired)
- were for the eligible employer (or another entity in their wholly-owned group) either:
- a full-time, part-time or fixed-term employee at 1 July 2020; or
- a long-term casual employee (employed on a regular and systematic basis for at least 12 months) as at 1 July 2020 and not a permanent employee of any other employer.
- were aged 18 years or older at 1 July 2020 (if you were 16 or 17 you can also qualify if you are independent or not undertaking full time study).
- an Australian resident.
Some employees are not eligible if they receive certain forms of Government assistance.
Wage condition
You satisfy the wage condition in respect of an employee for a JobKeeper fortnight in the extension period where their gross pay will exceed the relevant JobKeeper rate.
From 28 September 2020 to 3 January 2021, the JobKeeper Payment rates will be:
- $1,200 per fortnight for all eligible employees and for eligible business participants who were working for 20 hours or more a week on average in the four weeks of pay periods before either 1 March 2020 or 1 July 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 for business participants who were working for 20 hours or more a week on average in the four weeks of pay periods before either 1 March 2020 or 1 July 2020, and
- $650 per fortnight for other eligible employees and business participants.
The Commissioner of Taxation will have discretion to set out alternative tests where an employee or business participant’s hours were not usual during the February and/or June 2020 reference period (the period with the higher number of hours worked is to be used for employees with 1 March 2020 eligibility).
Guidance will be provided by the ATO where the employee was paid in non-weekly or non-fortnightly pay periods and in other circumstances the general rules do not cover.
The JobKeeper Payment will continue to be made by the ATO to employers in arrears. Employers will continue to be required to make payments to employees equal to, or greater than, the amount of the relevant JobKeeper Payment (before tax), based on the payment rate that applies to each employee.
You are required to give information about the entitlement for the fortnight, including details of the individual and the relevant rate, to the Commissioner, in the approved form.
The following questions are intended to assess eligibility for the Extension to the JobKeeper Scheme.
| Eligibility Criteria | ||
| Employer Conditions | Yes | No |
| Was my business being carried on 1 March 2020? | ||
| Has my actual GST Turnover declined by the required percentage? (Turnover >$.1 billion – 50% Turnover < $1 billion – 30%) | ||
| Notification -I have or I will advise the ATO on the approved form of my intention to participate in the extended JobKeeper Scheme? | ||
| Is the fortnight a JobKeeper fortnight? (28 September 2020 – 3 January 2021 – first extension) (4 January 2021 to 28 March 2021 – second extension) | ||
| I have or I will provide the ATO with information in the approved form? | ||
| Employee Conditions Was my employee? | Yes | No |
| Employed at any time in the fortnight? | ||
| At 1 March 2020 and or I July 2020 – | ||
| Aged 16 or over? | ||
| Full or part time? or Long term Casual Employee (> 12 months)? | ||
| Australian Resident? | ||
| The Employee has agreed to be nominated and has or will provide me with notification? | ||
| Wages Condition Have I paid my employee Gross Pay at the relevant JobKeeper Rate for the relevant fortnight? | ||
| Not Opted Out You have NOT notified the ATO that you no longer want to participate? |
If you have answered “yes” to ALL of the above you may qualify for the JobKeeper Payments from the ATO. We can assist you in confirming your eligibility and completing all necessary forms. Please contact us as a matter of urgency if you need any assistance with this.
If you have answered any question “No”, you are unlikely to qualify for the JobKeeper Payment Scheme.
| Business Participant Eligibility | ||
| Entity Requirements | Yes | No |
| Was my entity carrying on business on 1 March 2020? | ||
| Has my actual GST Turnover declined by the required percentage? (Turnover >$.1 Billion – 50% Turnover < $1 Billion – 30%) | ||
| Is the fortnight a JobKeeper fortnight? (28 September 2020 – 3 January 2021 – first extension) (4 January 2021 to 28 March 2021 – second extension)) | ||
| Have I provided the ATO with information in the approved form? | ||
| Individual – Business Participant Requirements | ||
| The individual was actively engaged in the business at any time in the fortnight? | ||
| The Individual is a relevant Business Participant If a Sole trader the sole trader If a Partnership – a partner If a Trust – an adult beneficiary of the trust If a Company – a Shareholder or Director | ||
| At 1 March 2020 and or 1 July 2020 – | Yes | No |
| Aged 16 or over? | ||
| Full or part time? or Long term Casual Employee (> 12 months)? | ||
| Australian Resident? | ||
| The individual has agreed to be nominated and provided the entity with notification? | ||
| Has the Entity satisfied the integrity Rule? |
If you have answered “yes” to ALL of the above you may qualify for the JobKeeper Payments from the ATO. We can assist you in confirming your eligibility and completing all necessary forms. Please contact us as a matter of urgency if you need any assistance with this.
If you have answered any question “No”, you are unlikely to qualify for the JobKeeper Payment Scheme.