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COVID-19 Update: JobKeeper

March 31st, 2020

On Monday, the Federal government announced details of a new wage subsidy called “JobKeeper”. The $130 billion package aims to keep business’s poised for a return to “business as usual” in the wake of the COVID-19 crisis, by keeping the staff of Australian business’s employed and “ready to go” when social restrictions are lifted.

In Summary

  • A subsidy of $1,500 per fortnight, per employee will be paid to business’s who have experienced a downturn in revenue of more than 30%.
  • In order to take part in the subsidy package, employers will need to ensure that each of their employees receive a wage of at least $1,500 per fortnight (before tax).
  • Subsidy payments will be paid in arrears by the ATO to employers one month after wages have been paid to employees (and reported to the ATO). The first round of subsidy payments are scheduled to arrive in the first week of May 2020, but will be retrospectively calculated from 30 March 2020.
  • The subsidy payments are expected to continue for the next 6 months, and employers will need to meet eligibility tests throughout this period in order to receive the subsidy payments.
  • More detail is expected to be provided on the package in the coming weeks once legislation surrounding the package has been passed.
  • In the meantime, employers and the self-employed can register their intent to claim the subsidy with the ATO by following the link below. Registrants will then be contacted directly by the ATO with updates on when applications for the package are ready to be made.

Register your intent here: https://www.ato.gov.au/general/gen/JobKeeper-payment/

Am I an eligible employer?

You are an eligible employer if you can demonstrate that the business has experienced a reduction in turnover (i.e. revenue) of more than 30%.

How do I show a reduction of 30%?

At this stage the example they’ve given is by comparing a month this year to the same month last year.  e.g. March 2020 had more than 30% less revenue than March 2019.

However, this example won’t make sense for a lot of businesses, so we’re expecting more detail on this when legislation is fully drafted.

What about the self-employed?

Sole traders and the self-employed who hold a valid ABN will be eligible for the JobKeeper payment if they meet the “turnover test” listed above.

What about Directors of Companies?

We are currently awaiting clarification on whether shareholders/directors of companies will also meet eligibility criteria for subsidy payments. In the meantime, we encourage business owners that fall into this category (and think they will pass the turnover eligibility) to register their interest with the ATO until more details come to light.

Am I an eligible employee?

 You are an eligible employee if: –

  • You were employed by the relevant employer at 1 March 2020; and
  • You are currently employed by the employer; and
  • Are full time, part-time, or long term casuals (a casual employee employed on a regular basis for 12 months as at 1 March); and
  • Are at least 16 years of age; and
  • Are an Australian citizen, hold a permanent visa, are a Protected Special Category Visa Holder, a non-protected Special Category Visa Holder who has been residing continually in Australia for 10 years or more, or a Special Category (Subclass 444) Visa Holder; and
  • Are not in receipt of a JobKeeper Payment from another employer

What if I have already been stood-down or made redundant?

Employees that have already been stood-down (but were employed as at 1 March 2020) will need to be re-instated by their employer, and be paid a wage of at least $1,500 per fortnight, in order for the employer to obtain the wage subsidy.

Employees that have already been made redundant (but were employer as at 1 March 2020) will need to be re-employed by their employer, and be paid a wage of at least $1,500 per fortnight, in order for the employer to be eligible for the wage subsidy.

Where to from here?

Employers and the self-employed should register their interest with the ATO using the link provided above (or below) if they think it is possible they are eligible for the subsidy payments. Then just sit tight and wait for more details to be released from the ATO surrounding the application process.
In the meantime, make sure your business bookkeeping and accounts are all up to date, so that you are ready to prove to the ATO that you are eligible to receive the subsidy payments when the time comes.
 
 

We’re happy to help!

Please feel free to reach out with any questions via info@whitesky.com.au