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JobKeeper Payment - Enrollments Open 20 April 2020

We've all been waiting for applications to open for the JobKeeper Payment, and the ATO has announced it is only days away!


What does this mean for you, your business and employees?



JobKeeper Payment - What is it?

It is a wage subsidy that will be paid through the tax system (administered by the ATO). Under the Scheme eligible businesses will receive a payment of $1,500 per fortnight for eligible employees, and/or for one eligible business participant. The subsidy payments will be paid for a maximum period of six months (from 30 March 2020 to 27 September 2020), and will be paid monthly in arrears commencing from the first week of May 2020.


Eligible Businesses

A business will only be eligible to receive JobKeeper Payment in respect of a 'eligible employee', if at the time of applying:

  • as at 1 March 2020 carried on a business or were a not-for-profit in operating Australia

  • employed at least one eligible employee at 1 March 2020

  • the eligible employee/s are currently employed (for the fortnights you wish to claim for)

  • the eligible employee/s are paid at lease $1,500 before tax (for the fortnights you wish to claim for)

  • for businesses with aggregated annual turnover of $1billion or less - the employer estimates that their projected GST turnover has reduced (or is likely to reduce) by 30% or more; or

  • for businesses with aggregated annual turnover of more than $1billion - the employer estimates that their projected GST turnover has reduced (or is likely to reduce) by 50% or more; and

  • the employer is not specifically excluded from the scheme (subject to the Major Bank Levy, one that is liquidation etc)

  • for charities and not-for-profits registered with ACNC - the employer estimates that their projected GST turnover has reduced (or is likely to reduce) by 15% or more

  • Universities, Non-Government Schools registered as charities will be subject to the 30% and 50% declines outlined above



Aggregated Annual Turnover

The aggregated annual turnover (to determine if the annual turnover of a business is $1billion or less is the same as what is used for determining whether an entity is a small business (SBE), which includes the annual turnover of an entity that is connected with or an affiliate of the entity.


Projected GST Turnover

You can choose your Projected GST Turnover period as being either monthly or quarterly (this is not dependent on you BAS reporting).


If you choose monthly can be any month from March 2020 to September 2020, and will be compared to the same month from 2019.

If you choose quarterly this can be either the quarter starting 1 April 2020 or 1 July 2020, and will be compared to the same quarter of 2019.


Turnover is based on GST turnover (however GST grouping is disregarded). The ATO is to release further information regarding applying the turnover test.


If your business has been in operation less than a year, or you might have unusually high or low turnovers due to particular circumstances the Commissioner of Taxation has the discretion to set an alternative test - this information is yet to be released by the ATO


You only need to satisfy this requirement once to remain eligible (you don't need to retest each turnover each month), however, there will be monthly reporting requirements - ATO to provide more information


Eligible Employees

Your employees will be eligible under the JobKeeper Payment Scheme if they:

  • are employed by you (including those stood down or re-hired)

  • as at 1 March 2020 were either a:

* permanent full-time or part-time employee

* long-term casual employee (employed on a regular and systematic basis for at least 12 months), and not a permanent employee of any other employer

  • as at 1 March 2020 was at least 16 years of age

  • as at 1 March 2020 was an Australian resident (under the Social Security Act 1991) or Subclass 22 Visa Holder

  • are not in receipt of government parental leave, dad and partner pay, or any payments in accordance with Australian workers compensation law for their incapacity to work

  • agree to be nominated by you


Eligible Business Participants

Includes:

  • Sole traders


Companies, Trusts and Partnerships can also nominate a business owner who is actively engaged in the business, and will be limited to only ONE eligible business participant (individual).

  • Company - director or shareholder

  • Trust - an adult beneficiary

  • Partnership - partner


The ATO is to provide further information regarding the eligibilty for sole traders and the other eligible business participants (for companies, trusts and partnerships).


If your business has an eligible business participant, you can have eligible employees as well.


From 20 April 2020 - Enrol for JobKeeper Payment

You or a registered tax professional can enrol your business for the JobKeeper payment via the MyGov Business Portal.


Steps:

1. register interest for JobKeeper payment and subscribe to updates at https://www.ato.gov.au/Job-keeper-payment/

2. check you and your employees meet the eligibility requirements.

3. continue to pay at least $1,500 to each eligible employee per JobKeeper fortnight (the first JobKeeper fortnight is the period from 30 March to 12 April).

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.

5. send the JobKeeper employee nomination notice to your nominated employees to complete and return to you by the end of April if you plan to claim JobKeeper payment for April. Keep it on file and provide a copy to your registered tax agent if you are using one. https://www.ato.gov.au/Forms/JobKeeper-payment---employee-nomination-notice/

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.

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.

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).



From 4 May 2020 - Apply for JobKeeper Payment

You or a registered tax professional can apply for the JobKeeper payment via the MyGov Business Portal for your eligible employees.


Steps:

1. apply to claim the JobKeeper payment by logging in to the ATO Business PortalExternal Link

2. ensure you have paid each eligible employee a minimum of $1,500 per JobKeeper fortnight before tax.

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

- using a registered tax agent who will submit a report on your behalf through Online services for agents.

4. submit the confirmation of your eligible employees online and wait for the confirmation screen.

5. notify your eligible employees you have nominated them.

6. the ATO will pay you the JobKeeper payment for all eligible employees after receiving your application.

7. each month, you will need to reconfirm that your reported eligible employees have not changed through ATO online services, the Business Portal or via your registered tax agent. This will ensure you will continue to receive the JobKeeper payments from the ATO. 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.

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



This information is up to date as at 15 April 2020

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