The Federal Government has announced (as part of its Coronavirus Stimulus Package) the introduction of a new JobKeeper Payment to assist eligible employers (and self-employed individuals) who have been impacted by the Coronavirus pandemic to continue to pay their workers.
An overview of the package is as follows;
Ø Eligible Employers will be paid a subsidy of $1,500 per fortnight for each employee as part of a “job keeper payment” .
Ø Eligible Employers will need to register via the ATO website to receive the payments starting in the first week of May and will cover the next six months and backdated to March.
Ø Where an employer receives the JobKeeper Payment for an eligible employee who has been receiving income support through Centrelink (or Services Australia) as a result of having been stood down or their hours being reduced, the employee will need to report the JobKeeper Payment
as income, as this could affect their entitlement to such Centrelink support.
Ø If your workers have already been stood down they will be eligible for the allowance if they were on your books on March 1.
Ø The payment will apply to part-time and full-time workers, sole traders and casuals providing they have been with you for 12 months or more.
Ø Participating employers will be required to ensure eligible employees will receive, at a minimum, $1,500 per fortnight, before tax.
Ø Eligible employers that apply for the JobKeeper Payment (i.e., via an online application) will need to provide supporting information demonstrating a downturn in their business, and must report the number of eligible employees employed by the business on a monthly basis.
Ø Businesses without employees (e.g., self-employed individuals) will need to provide an ABN for the business, nominate an individual to receive the JobKeeper payment and provide that individual’s Tax File Number, as well as provide a declaration on the recent business activity (presumably, to demonstrate the downturn in the business).
Initially, businesses can start to register their interest in applying for the JobKeeper payment from 30 March 2020, on the ATO’s website at www.ato.gov.au.
Ø for a business with a turnover of less than $1 billion – its turnover will be reduced by more than 30% relative to a comparable period a year ago (of at least a month); or
Ø for a business with a turnover greater than $1 billion – its turnover will be reduced by more than 50% relative to a comparable period a year ago (of at least a month); and
Ø the business is not subject to the Major Bank Levy.
Self-employed individuals (i.e., businesses without employees) and not-for-profit entities (including charities) that satisfy the above requirements will be eligible to apply for the JobKeeper Payment.
Ø The employee is currently employed by the employer (which includes an employee who has been stood down or re-hired after they had already lost their job).
Ø The employee was employed by the employer as at 1 March 2020.
Ø The employee is a full-time or part-time employee, or a long-term casual employee who has been employed by the employer on a regular basis for longer than 12 months at 1 March 2020.
The Proposed Jobkeeper Payment
Ø The employee is at least 16 years of age.
Ø The employee is an Australian citizen, or the holder of a permanent visa, a Protected Special Category Visa Holder, a non-protected Special Category Visa Holder who has been residing continually in Australia for 10 years or more, or a Special Category (Subclass 444) Visa Holder.
Ø The employee is not in receipt of a JobKeeper Payment from another employer.
To discuss how you and your business may benefit from the package as outline above please ring your point of contact at GM Tax.