Please see below for an update on the JobKeeper payment.

Zoom Q&A, today at 4pm.

If you have any questions, please join the zoom question and answer session at 4pm today with this link

https://us02web.zoom.us/j/82087161387

Turnover Test

The ATO has stated at

https://www.ato.gov.au/General/JobKeeper-Payment/In-detail/Applying-the-turnover-test/

“You only need to satisfy the fall in turnover test once – you don’t need to test your turnover in the following months or quarters.

However, there are ongoing monthly turnover reporting requirements.”

This means that if your turnover has dropped by more than 30% in March 2020 or is forecast to in April 2020 or April to June 2020 compared to the corresponding period in 2019 and you register by 30th April, you will be eligible for JobKeeper for the entire April to September JobKeeper period.

It also means that as soon as you qualify for JobKeeper and register, you will be eligible for the entire remaining period. Eg. your May turnover is forecast to be down by 30%, you register in May, you receive JobKeeper from May to September.

Turnover test period

The ATO has defined the period for which you compare your turnover as the ‘turnover test period’.

You can choose to either use a month or a BAS quarter to compare your turnover, regardless of whether you lodge BAS’s quarterly or monthly.

For registration from April, you can use either March 2020, April 2020 or the June 2020 quarter as your turnover test period.

If you are using April 2020 or the June 2020 quarter, you can use forecast turnover and compare with actual turnover for the same period in 2019.

For April 2020, given you have until the end of April to register, you should know revenue up to this date and thus be able to have an accurate forecast of turnover by the end of April.

You can register at a later time using a later month or quarter. You will only be eligible for JobKeeper payments for JobKeeper fortnights that end on or after your turnover test period starts.

If you are using the September quarter as your turnover test period, you will only receive JobKeeper from July 2020 or later.

Enrolment period

The ATO has stated that

“To ensure you receive your JobKeeper payments as early possible, you should enrol by the end of April. However, enrolments are open till the end of May if you need more time.”

(https://www.ato.gov.au/General/JobKeeper-Payment/Employers/Enrol-for-the-JobKeeper-payment/#Step1)

It is unclear if any registrations will be accepted after the end of May, even if turnover drops only after May and your business is only eligible after May. If a later drop in turnover is a possibility for your business, it is important to review the ATO’s enrolment period and if necessary enrol by the end of May to ensure you don’t miss out.

Cash or accruals basis

You may use an accruals basis of accounting (based on invoices) to calculate both the current and projected turnover.

However, if your BAS’s are on a cash basis (when you actually receive payment), you can calculate current and projected turnover on a cash basis.

Thus, if your BAS’s are on a cash basis, you can choose between calculating turnover on an accruals or cash basis.

Definitions of Turnover

There are some technical definitions of turnover the ATO has discussed, however the vast majority of businesses will not need to be concerned with these rules and turnover will simply be ordinary sales. There are exclusions relating to entities that are part of groups, donations, sales not connected with enterprises (eg. sale of a private car) and sales not connected with Australia.

The ATO has listed modifications to the definitions of turnover at https://www.ato.gov.au/General/JobKeeper-Payment/In-detail/Applying-the-turnover-test/?anchor=Basictest#Basictest.

Sole Traders, Partnerships, Trusts and Companies

The ATO uses the term ‘eligible business participant’ to describe the person nominated to receive JobKeeper who is actively engaged in the business but doesn’t receive a wage through the payroll system.

Eligibility is limited to one person per entity. There are some exclusions relating to receiving government parental leave and Dad pay and those incapacitated and receiving workcover.

The entity must have been actively trading and have lodged a 2019 tax return or a BAS in 2019 showing sales. See https://www.ato.gov.au/General/JobKeeper-Payment/Sole-traders-and-other-entities/ for details and for ATO guidance on general eligibility.

Sole Trader Registration

If you are a sole trader, you can nominate yourself as the ‘eligible business participant’ during the online enrolment process in the Business Portal or in ATO online services via myGov.

More specific registration details for sole traders is at https://www.ato.gov.au/General/JobKeeper-Payment/In-detail/JobKeeper-guide—sole-traders/

Partners, trust beneficiaries or company shareholders or directors

To nominate a partner, trust beneficiary or company shareholder or director for JobKeeper to be an eligible business participate, the participant has to complete the nomination form and ensure it is retained by the entity.

The form can be downloaded at https://www.ato.gov.au/Forms/JobKeeper-nomination-notice-for-eligible-business-participants—excluding-sole-traders/

You do not need to send this form to the ATO but you must keep it for your records.

The participant is then added to the ATO records as part of the standard JobKeeper registration process (don’t include them as an employee).

How to Enrol

You or your registered tax or BAS agent can enrol for the JobKeeper payment.

Log in to the Business Portal using myGovID.

Select Manage employees then the link for the JobKeeper payment.

Fill in the JobKeeper enrolment form and provide your:

  • eligibility information
  • expected number of eligible employees
  • contact and bank details.

 Notify your eligible employees you have nominated them.

To ensure you receive your JobKeeper payments as early possible, you should enrol by the end of April. However, enrolments are open till the end of May if you need more time.

If you have an eligible business participant, remember not to include them as an employee.

If you are identifying an eligible business participant, add them in the Business Portal.

You can identify your employees in one of the following ways:

Directly into your STP enabled payroll software if it is updated with JobKeeper functionality.

In the Business Portal if your STP payroll software is not updated with JobKeeper functionality

Updating Employee Details

You can update employee details if necessary through your payroll software if it is ‘Jobkeeper enabled’ or through the business portal.

Monthly declarations to the ATO

Each month, you must reconfirm your reported eligible employees and eligible business participant through the Business Portal or via your registered tax or BAS agent.

If your eligible employees change or leave your employment, you will need to notify the ATO through this monthly declaration.

You must also provide information as to your current and projected turnover. This is not a retest of your eligibility, but rather an indication of how your business is progressing under the JobKeeper Payment scheme.

Employees with multiple employers

If you have multiple employers, only one employer can claim the JobKeeper payment on your behalf. Your employers may ask you to tell them if you agree to be nominated as an eligible employee of theirs to receive the JobKeeper payment.

If you are employed by more than one employer, you should contact your employers and tell them which employer you want to receive the JobKeeper payment from.

If you are a long-term casual and you have other permanent employment, you must choose your permanent employer – you cannot be nominated by your casual employer.

Employees who were stood down, terminated or are on leave

If you were stood down after 1 March 2020, your employer will be able to claim the JobKeeper payment on your behalf if you both meet the eligibility criteria including that your employer starts paying you a minimum of $1,500 (before tax) per fortnight.

If you were terminated after 1 March 2020, your employer may choose to re-engage you and claim the JobKeeper payment on your behalf if you both meet the eligibility criteria.

If you have taken up other work after being stood down, you may earn additional income without your eligible employer’s JobKeeper payment being affected. As long as you are eligible and maintain your employment (including being stood down) with your JobKeeper-eligible employer (including receiving $1,500 (before tax) per fortnight from them). However, you can only nominate one employer to receive the JobKeeper payment from.

Guidelines for paying employees

You should pay their eligible employees in line with their existing pay amounts and pay cycle and meet these requirements:

You should pay the minimum $1,500 (before tax) to each eligible employee each fortnight (starting with the fortnight 30 March – 12 April) to claim the JobKeeper payment for that fortnight.

You need to continue to pay employees you are claiming for either every subsequent fortnight until 27 September 2020 or until their employees stop being eligible or you opts out.

If your ordinary arrangement is to pay employees less frequently than fortnightly, the payment can be allocated between fortnights in a reasonable manner. For example, if an employer’s ordinary arrangement is to pay an employee every four weeks, it will be reasonable if the employee is paid at least $3,000 for every four-week period.

For the first two fortnights (30 March – 12 April and 13 April – 26 April), the ATO will accept the minimum $1,500 payment (before tax) has been paid for each fortnight even if it has been paid late, provided it is paid by the end of April. This means that you can make two fortnightly payments of at least $1,500 per fortnight before the end of April, or a combined payment of at least $3,000 before the end of April.

If your eligible employees earn less than $1,500 (before tax) per fortnight, you must pay them $1,500 per for each fortnight to claim the JobKeeper payment. This ‘top up’ of their salary or wages will ensure they remain eligible.

Employers cannot pay their employees less than $1,500 (before tax) per fortnight and keep the difference.

You will not be eligible for the JobKeeper payment if you pay your nominated employee less than $1,500 (before tax) per fortnight.

If your eligible employees earn more than $1,500 per fortnight, you will only receive $1,500 for each eligible employee and you should pay any additional balance yourself.

If an employee has been stood down after 1 March, and you re-engage them, you must pay your eligible employee at least $1,500 (before tax) per fortnight. They will only be eligible to claim for the fortnights after they have re-engaged your employee within the pay period.

If an employee was employed on 1 March 2020, subsequently ceased employment with their employer, and has since been re-engaged by them, the employee must receive, at a minimum, $1,500 (before tax) per fortnight.

You cannot claim the reimbursement for the JobKeeper payment for employees who were not paid the full $1,500 per fortnight amount during each JobKeeper payment period.

 

 

 

 

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