Stop the Press: JobKeeper Update

On the 14 April 2020 the ATO has release some further guidance on JobKeeper.
 

Turnover Test

How to calculate a fall in turnover for the first fortnight of JobKeeper Payment starting 30 March 2020 (30 March 2020 to 12 April 2020).

To work out your fall in turnover, you can compare either:

• GST turnover for March 2020 with GST turnover for March 2019, or
• Projected GST turnover for April 2020 with GST turnover for April 2019, or
• Projected GST turnover for the quarter starting April 2020 with GST turnover for the quarter starting April 2019

If you work out that you qualify for the JobKeeper Payments for the first fortnight because your turnover has declined by the relevant amount, for most small-medium business that is 30%, you remain eligible and do not need to keep testing turnover in following months. However, you will have ongoing monthly reporting requirements.

Before you Enrol for JobKeeper

Before you enrol to receive JobKeeper Payments, you need to notify each eligible employee that you intend to nominate them as eligible employees under the JobKeeper scheme.

You must tell those employees that you have nominated them as an eligible employee to claim the JobKeeper Payment. They must agree to be nominated by you by completing the JobKeeper Employee Nomination Notice.

Use the link below to access the notice
https://www.ato.gov.au/assets/0/104/300/387/d1aab7f2-fbe8-44b8-9ec1-4885ded1088e.pdf
Your eligible employees must return the notice to you for your records. The nomination form does not need to be provided to the ATO however employers are required to keep a copy of the completed form as part of their record keeping obligations under the law.

An eligible employee can only nominate one employer for JobKeeper Payment.

Payment to Eligible Employees

If you meet the eligibility criteria and want to start claiming the JobKeeper Payment on behalf of your eligible employees, you need to start paying them at least $1,500 per fortnight (before tax) and continue to pay them for as long as you keep claiming.

For the first two fortnights (30 March – 12 April, 13 April – 26 April), the ATO will accept the minimum $1,500 payment for each fortnight has been paid by you even if it has been paid late, provided it is paid by you 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.

“Stood Down” employees will in effect be paid from 30 March 2020.

However, for “terminated” employees that you choose to re-engage, you will only be able to claim JobKeeper Payment from the date of re-engagement. That is, you cannot claim retrospectively.

If employers do not continue to pay their employees for each pay period, they will cease to qualify for the JobKeeper payment.

Enrol for JobKeeper Scheme

You will be able to enrol in the JobKeeper scheme from 20 April 2020, using the Business Portal and authenticate with myGovID.

Please note: this must be done by the end of April to claim JobKeeper payments for the month of April.

• Step 1 – Register your interest and subscribe for JobKeeper Payment updates (many of you would have already registered)  https://www.ato.gov.au/Job-keeper-payment/

• Step 2 – Check you and your employees meet the eligibility requirements.

• Step 3 – Continue to pay at least $1,500 (gross) to each eligible employee per JobKeeper fortnight (the first JobKeeper fortnight is the period from 30 March to 12 April). Please note that you do not need to change your normal payroll cycle.

• Step 4 – Notify your eligible employees that you are intending to claim the JobKeeper Payment on their behalf and check they aren’t claiming JobKeeper Payment through another employer or have nominated through another business.

• Step 5 – Send the JobKeeper Employee Nomination Notice to your nominated eligible employees to complete and return to you by the end of April if you plan to claim JobKeeper Payment for April. Once returned by the employee keep it on file for your records.

• Step 6 – From 20 April 2020, you can enrol with the ATO for the JobKeeper Payment using the Business Portal and authenticate with MyGovID. You must do this by the end of April to claim JobKeeper payments for April.

• Step 7 – In the online form, provide your bank details and indicate if you are claiming an entitlement based on business participation, for example if you are a sole trader.

• Step 8 – Specify the estimated number of employees who will be eligible for the first JobKeeper fortnight (30 March – 12 April) and the second JobKeeper fortnight (13 April – 26 April).

Claim JobKeeper Payment

From 4 May 2020, you can apply for the JobKeeper Payment by logging in to the ATO Business Portal via your MyGovID linked to your ABN. Please note that the ATO will be paying monthly in arrears.

• Step 1 – Apply to claim the JobKeeper Payment by logging in to the ATO Business Portal

• Step 2 – Ensure you have paid each eligible employee a minimum of $1,500 (gross before tax) per JobKeeper fortnight.

• Step 3 – Identify your eligible employees in the application form by selecting employee details that are prefilled from your STP pay reports if you report payroll information through an STP enabled payroll solution, or manually entering employee details in ATO online services or the Business Portal if you do not use an STP enabled payroll solution, or we can assist you with submitting a report on your behalf through our Online services.

• Step 4 – Submit the confirmation of your eligible employees online and wait for the confirmation screen.

• Step 5 – Notify your eligible employees you have nominated them.

• Step 6 – The ATO will pay you the JobKeeper Payment for all eligible employees after receiving your application.

• Step 7 – Each month, you will need to reconfirm that your reported eligible employees have not changed through ATO online services. This will ensure you will continue to receive the JobKeeper Payments. You do not need to retest your reported fall in turnover, but you will need to provide some information as to your current and projected turnover. This will be done in your monthly JobKeeper Declaration report.

• Step 8 – If your eligible employees change or leave your employment, you will need to notify the ATO through your monthly JobKeeper Declaration report.

Tax Consequences

All JobKeeper Payments are assessable income of the business that is eligible to receive the payments.

The normal rules for deductibility apply in respect of the amounts your business pays to its employees where those amounts are subsidised by the JobKeeper Payment.

The JobKeeper Payment is not subject to GST, as such care must be undertaken to ensure your accounting system does not account for GST on the receipts of JobKeeper Payments..

Superannuation guarantee

New rules are being introduced by the government with the intention to not require super guarantee to be paid on additional payments that are made to employees as a result of JobKeeper Payments.