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JobKeeper Payment

The government has recently announced the JobKeeper payment.
This is designed to keep workers engaged in your business, so you have the workforce ready for when your business resumes to normal. This payment will also enable for the first time, sole traders may qualify for income support.

Criteria 1

  • If the turnover of your business has decreased by 30% or more, then all employees are entitled to a Job Keeper payment of $1,500 per fortnight.
  • The comparison period is the same month in the previous year. (Which month? we do not know as yet)
  • The big news here is even if you have no employees, that is you are in business as a sole trader, if your turnover has dropped by 30% you can get the full Job Seeker payment for yourself and it is not affected at all by your spouse’s income.

IF YOUR TURNOVER HAS NOT DECREASED BY 30%, THEN THE BUSINESS WILL NOT QUALIFY
Criteria 2

  • Eligible employees need to have been on your books, full-time or part-time as at 1st March, 2020.
  • If they are casual employees they need to have been regularly employed for more than 12 months before 1st March, 2020. It does not matter that they may have been stood down or sacked since that date.
  • If you take them back they still qualify for the Job Keeper payment.
  • Employees can only receive a JobKeeper payment from one employer. It is recommended that you get the employee to elect in writing they are selecting your business as the employer.
  • The employee needs to be 16 years or older.
  • Temporary residents do not qualify, with the exception of New Zealanders on the 444 visa.

Registering

  • We will discuss this with you individually and register for you after we have discussed your business performance
  • You can register your interest with the ATO here for updates, but we will keep you informed https://www.ato.gov.au/general/gen/JobKeeper-payment/
  • This is paid through the tax office to the employer for the next 6 months. One month in arears. Employers need to register and report to the ATO monthly.

Payments

  • It does not matter that the employee was only working part-time and earning less than $1,500 a fortnight.
  • They will now be paid $1,500 a fortnight by the government, through their employer. If they have registered for the Job Seeker payment, they WILL NOT receive both.
  • You won’t actually receive any money from the government until the first week of May so there may be a catch 22 for cash strapped employers.

For the employee

  • The Job Keeper payment is taxable income to the employee.
  • This $1,500 (per fortnight) is no more than what an employee would receive on the “Job Seeker” payment
  • Some employees would not qualify because they have a spouse still in full-time employment or perhaps they are an adult child (Under 23) living at home and their parents’ income would prohibit them receiving any payment.

Cost to the employer

  • It is fully offset in the accounts of the employer. The employee must receive this entire payment.
  • The employer is expected to continue to pay the superannuation guarantee on the normal wage.
  • In the case of an employee that was paid less than the Job Keeper payment and is now on a higher wage as a result of the Job Keeper payment, the employer is not required to pay the guarantee on the difference.

This payment does not generate any income for your business, but it enables you to keep your employees engaged. If you receive $1,500 you must pay your employee the same.
The government has created a lot of headlines and as you can appreciated, there is little detail. Click on Fact Sheet Info for Employers to download the full fact sheet on this specific announcement.
I understand that this is a difficult time for all of us and the Supplementary Team is committed to assist your business. We are also committed to making sure we understand all of the announcements. Please let me know if you need to discuss this further.
Finally, on good news, the state government released their grant program today. There are a couple of things you will need to attach in your applications which we can provide you if you don’t have a copy.
https://www.business.vic.gov.au/support-for-your-business/grants-and-assistance/business-support-fund
Source: Leah Supple – Supplementary Complete Accounting