By Rowena Thiele
Details of the $130B JobKeeper scheme have finally been announced, which provide a wage subsidy of $1500 per fortnight for eligible employees, sole traders, partnerships, directors and beneficiaries.
It’s important to note the intention of this package is to assist businesses in keeping their employees engaged and take the pressure of the Centrelink system. As such there is a high compliance risk here for people who get the initial ongoing reporting wrong or are looking to take advantage. Enrolment will open on the 20th April 2020 and if you don’t do this by the 26th April 2020 you will miss out on the first two fortnight payments.
For those that want to manage the registration and set up process themselves:
• Enrolment will open 20th April using the business portal which is authenticated using your MyGovID.
• Ensure you have an accurate record of your turnover for the 2018-19 income year and for the 2019-20 year to date and projections for the remaining months to 30th September.
• Ensure you keep an accurate record of turnover from March 2020 onwards
• Compare your turnover for the month or quarter ended 31 March 2019 with revenue for the month or quarter ended 31 March 2020 to make a high-level assessment of whether this measure is likely to be available
• Measure the percentage decline in your turnover to see whether it has declined by at least 30 per cent
• If you are not eligible in March, you may become eligible in another month
Identify eligible employees
• Nominate the employees eligible for the JobKeeper payments – you will need to provide this information to the ATO and keep that information up to date each month. The ATO will use Single Touch Payroll to prepopulate the information in most cases.
• Notify all eligible employees that they are receiving a JobKeeper payment. Employees can only be registered with one employer.
• Pay eligible employees at least $1500 per fortnight (before tax). The employee must continue to be paid the greater of:
• The amount payable for the work that they perform (including any incentives, bonuses, loadings, allowances, overtime or penalty rates, and leave payments owing); or
• The JobKeeper payment of $1500
• Pay superannuation guarantee on Ordinary Times Earnings (OTE). That is, you do not reduce superannuation guarantee unless the employee was earning less than the JobKeeper payment amount. If the employee normally receives less than $1500 per fortnight before tax, the employer can decide whether to pay superannuation guarantee on the additional amount that is paid as a result of the JobKeeper program.
• From 4th May onwards, you can apply to claim the JobKeeper payment by logging in to the business portal.
• Ensure you have completed the above steps for all eligible employees.
• Submit the confirmation of your eligible employees online and wait for the confirmation screen.
• The ATO will pay you the JobKeeper payment for all eligible employees after receiving this application.
• Each month, you will need to reconfirm that your reported eligible employees have not changed. Either through ATO online services, the business portal or via your registered tax agent. This will ensure you continue to receive the JobKeeper payment. Importantly, 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.
• If your eligible employees change or leave your employment, you will need to notify the ATO through this JobKeeper Declaration report.
Authored by Rowena Thiele, Director, AB Phillips Pty Ltd
Please note information provided is accurate as at 21 April 2020. Information provided should not be relied on as a substitute for detailed professional advice from AB Phillips or professional legal or financial advice on any particular matter. Where you would like additional information and support about the content in this document please contact AB Phillips.