From 28 September 2020, the second tranche of the JobKeeper scheme changes the eligibility tests for employers and employees, and the method and amount paid to eligible employees.
To receive JobKeeper from 28 September 2020, employers will need to reassess their eligibility with reference to actual GST turnover for the September 2020 quarter (for JobKeeper payments between 28 September to 3 January 2021), and again for December 2020 quarter (for payments between 4 January 2021 to 28 March 2021).
The broad eligibility tests to access JobKeeper remain the same with an extended decline in turnover test.
1 March 2020 is an absolute date. An employer that had ceased trading, commenced after 1 March 2020, or was not pursuing its objectives in Australia at that date, is not eligible.
*Additional tests apply from 28 September 2020.
To receive JobKeeper payments from 28 September 2020, businesses will need to meet the basic eligibility tests and an extended decline in turnover test based on actual GST turnover.
|30 March to 27 September 2020||28 September to 3 January 2021||4 January 2021 to 28 March 2021|
|Decline in turnover||Projected GST turnover for a relevant month or quarter is expected to fall by at least 30% (15% for ACNC-registered charities, 50% for large businesses) compared to the same period in 2019.*||Actual GST turnover in the September 2020 quarter(July, August & September) fell by at least 30% (15% for ACNC-registered charities, 50% for large businesses) compared to the same period in 2019.
The decline for the quarter needs to be met to continue receiving JobKeeper payments.
|Actual GST turnover in the December 2020 quarter (October, November & December)fell by at least 30% (15% for ACNC-registered charities, 50% for large businesses) compared to the same period in 2019. The decline for the quarter needs to be met to continue receiving JobKeeper payments.
* Alternative tests potentially apply where a business fails the basic test and does not have a relevant comparison period.
Most businesses will generally use their Business Activity Statement (BAS) reporting to assess eligibility. However, as the BAS deadlines are generally not due until the month after the end of the quarter, eligibility for JobKeeper will need to be assessed in advance of the BAS reporting deadlines to meet the wage condition for eligible employees. However, the ATO will have discretion to extend the time an entity has to pay employees in order to meet the wage condition.
Alternative arrangements are expected to be put in place for businesses and not-for-profits that are not required to lodge a BAS (for example, if the entity is a member of a GST group).
The Commissioner of Taxation will have discretion to set out alternative tests that would establish eligibility in specific circumstances where it is not appropriate to compare actual turnover in a quarter in 2020 with actual turnover in a quarter in 2019. These alternative tests have not as yet been released.
The Government has announced that employee eligibility tests will change from 3 August 2020 onwards.
Under the current version of the JobKeeper scheme an employee must generally have been employed by the relevant entity on 1 March 2020 to be eligible for JobKeeper payments. Someone employed as a casual on that date also must have been employed on a regular and systematic basis for the 12 month period leading up to 1 March 2020.
However, these proposed changes mean that employees who were previously ineligible for JobKeeper because they were not employed by the entity on 1 March 2020 may now be able to receive JobKeeper payments if they were employed by the entity on 1 July 2020 and can fulfil all of the other eligibility requirements.
*A ‘long term casual employee’ is a person who has been employed by the business on a regular and systematic basis during the period of 12 months that ended on the applicable testing date (previously 1 March 2020, but changing to 1 July 2020). These are likely to be employees with a recurring work schedule or a reasonable expectation of ongoing work.
From 28 September 2020 the payment rates for JobKeeper will reduce and split into a higher and lower rate.
Whether an eligible employee can access the higher or lower rate will depend on the number of hours they worked during a 4 week test period. The Government indicates that the higher rate will apply to employees who worked at least 20 hours a week on average in the four weeks of pay periods prior to either 1 March 2020 or 1 July 2020.
|JobKeeper||30 March to 27 September 2020||28 September to 3 January 2021||4 January 2021 to 28 March 2021|
|Payment||· $1,500 per fortnight per employee||· $1,200 per fortnight per employee or business participant who worked >20 hours per week
· $750 per fortnight per employee or business participant working < 20 hours per week
|· $1,000 per fortnight per employee or business participant who worked > 20 hours per week
· $650 per fortnight per employee or business participant working < 20 hours per week
JobKeeper payments from 28 September 2020 are paid at a lower rate for employees who worked less than 20 hours per week on average in the four weeks of pay periods before 1 March 2020 and the four weeks of pay periods before 1 July 2020.
The Commissioner of Taxation will have discretion to set out alternative tests for those situations where an employee’s or business participant’s hours were not usual during February or June 2020. Also, the ATO will provide guidance on how this will be dealt with when pay periods are not weekly. This guidance is not as yet available.
If your business and your employees passed the original eligibility tests to access JobKeeper, and you have fulfilled your wage requirements, you can continue to claim JobKeeper up until the last JobKeeper fortnight that ends on 27 September 2020.
ATO Assistant Commissioner Andrew Watson said in a recent interview, “Once you’re in, you’re in to the end of September. If you meet the eligibility test once, you’re in it for the whole time.” The original eligibility test was a once only test although there are ongoing conditions that need to be satisfied for each JobKeeper fortnight.
|JobKeeper fortnight||Payment rate|
|1||30 March 2020 – 12 April 2020||JobKeeper 1.0||Eligibility period 1||$1,500 per fortnight|
|2||13 April 2020 – 26 April 2020|
|3||27 April 2020 – 10 May 2020|
|4||11 May 2020 – 24 May 2020|
|5||25 May 2020 – 7 June 2020|
|6||8 June 2020 – 21 June 2020|
|7||22 June 2020 – 5 July 2020|
|8||6 July 2020 – 19 July 2020|
|9||20 July 2020 – 2 August 2020|
|10||3 August 2020 – 16 August 2020|
|11||17 August 2020 – 30 August 2020|
|12||31 August 2020 – 13 September 2020|
|13||14 September 2020 – 27 September 2020|
|14||28 September 2020 – 11 October 2020||JobKeeper 2.0||Eligibility period 2||High rate: $1,200
Low rate: $750
|15||12 October 2020– 25 October 2020|
|16||26 October 2020 – 8 November 2020|
|17||9 November 2020 – 22 November 2020|
|18||23 November 2020 – 6 December 2020|
|19||7 December 2020 – 20 December 2020|
|20||21 December 2020 – 3 January 2021|
|21||4 January 2021 – 17 January 2021||Eligibility period 3||High rate: $1,000
Low rate: $650
|22||18 January 2021 – 31 January 2021|
|23||1 February 2021 – 14 February 2021|
|24||15 February 2021 – 28 February 2021|
|25||1 March 2021 – 14 March 2021|
|26||15 March 2021 – 28 March 2021|
This document contains general advice only and is prepared without taking into account your particular objectives, financial circumstances and needs. The information provided is not a substitute for legal, tax and financial product advice. Before making any decision based on this information, you should speak to a licensed financial advisor who should assess its relevance to your individual circumstances. While The Field Group believes the information is accurate, no warranty is given as to its accuracy and persons who rely on this information do so at their own risk. The information provided in this bulletin is not considered financial product advice for the purposes of the corporations Act 2001.
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