JOB KEEPER PAYMENT: WHAT IS IT AND WHO IS ELIGIBLE?

If your business has experienced a significant decrease in revenue (or is likely to), this is critical information for you to consider. We are doing everything we can to support you and it’s important for you to act sooner rather than later regarding the following information about the JobKeeper payments. Whilst there is some grace for the first two fortnights, if you don’t enrol in time you may miss out.
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We know you might be wondering what the JobKeeper Payment actually is and whether you’re eligible. We hope this information provides you with a little clarity and direction about how it helps you.

To find out more about how to participate in the JobKeeper scheme, have a look at another post of ours: JobKeeper Payments: How do I participate?
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What is the JobKeeper Payment?

The JobKeeper Payment is a payment that is available to eligible businesses, with eligible employees to support you to continue to keep your employees.

Eligible businesses will receive $1,500 per fortnight per eligible employee and/or for one eligible business participant (e.g. sole trader, partner, company director or shareholder, or trust beneficiary).

JobKeeper payments will be paid for up to 6 months, on a monthly basis in arrears. Regardless of your payroll system (i.e.. weekly or monthly pays), JobKeeper Payments are based on a fortnightly cycle. JobKeeper Payments will be paid by the Tax Office to eligible businesses, beginning in the first week of May. The first eligible fortnight begins March 30th, so in May you will be paid for the number of fortnights from:

• Monday, 30 March to Sunday, 12 April, and
• Monday, 13 April to Sunday, 26 April.

Who is Eligible for JobKeeper Payments?

To receive JobKeeper Payments you must:

• Be an eligible business
• Have eligible employees (and/or an eligible business participant)

What is an Eligible Business?

For your business to be eligible, the requirements are:

• At 1 March 2020, you carried on a business in Australia
• Your business has faced (or is projected to face) a 30% fall in turnover (for businesses with an aggregated turnover of $1 billion or less)

How do you calculate a 30% fall in turnover?

There are 3 basic different ways you can calculate whether you have experienced a 30% fall in turnover:

1. By comparing your GST turnover in March 2020 with your GST turnover in March 2019;
2. By comparing your projected GST turnover for April 2020 with your GST turnover for April 2019; or
3. By comparing your projected GST turnover for the quarter starting April 2020 with your GST turnover for the quarter starting April 2019

The method you choose to calculate the fall in your turnover is not dependent on whether you report a quarterly or monthly BAS.

Initially you might find that your turnover has not decreased by 30% or more or is not currently projected to decrease by 30%. If that’s the case you can continue to assess this each month, and it’s important to do so, as you can’t backdate your enrolment. As such, you’ll want to apply online ASAP at any time between 20 April and 27 September if you determine you are eligible.

If you find that your turnover has decreased by 30% or more in the first JobKeeper period, this will make you eligible from the start for JobKeeper payments for the full 6 months. You do not need to continue to prove that you met the turnover test, once you pass it once you remain eligible.

What if your business is unable to use these methods?

The ATO understands that some businesses haven’t been in operation for a year or have other unique circumstances. If you are in this situation, you will be able to use an alternative turnover test.

The ATO will be providing further information about this test soon.

Which Employees are Eligible?

To claim eligible employees, you must have employed at least 1 eligible employee on 1 March 2020.

Your eligible employees must be employed by your business for the fortnights you claim for (including those who are stood down or re-hired).

If you are participating in the JobKeeper Scheme, you are required to include ALL eligible employees in the scheme. An exception to this is if your employee has advised you that they do not wish you to claim on their behalf.

For an employee to be eligible, they must meet specific criteria. These are:

1. The employee is employed by you (including those stood down or re-hired)
2. On 1 March 2020, they were:

• A permanent full time or part time employee, or
• A 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

3. They must be at least 16 years of age on 1 March 2020.
4. They were an Australian resident on 1 March 2020 within the meaning of the Social Security Act 1991, which requires that they reside in Australia and are:

• An Australian citizen, or
• The holder of a permanent visa, or
• The holder of a Protected Special Category Visa, or
• An Australian tax resident who is a Special Category (Subclass 444) – (Mostly relevant for our friends from New Zealand)

5. During the JobKeeper fortnight, the employee was not in receipt of the following payments:

• Government parental leave or Dad and partner pay
• A payment in accordance with Australian workers compensation law for an individual’s total incapacity for work.

6. The employee agrees to be nominated by you (indicated by completion of Nominating Employee form, the link is below at Step 5)
7. Employee has been paid at least $1,500 (gross, before tax) in a JobKeeper fortnight – THIS IS CRITICAL

What if I’m Self Employed?

Sole traders and other businesses who have business owners actively engaged but not on the payroll system are eligible.

Eligibility is based on 1 business owner only, e.g. a shareholder or working director, a partner in a partnership, or an adult beneficiary in a trust.

There will be more details on this released by the ATO.
​To find out more about how to participate in the JobKeeper scheme, have a look at another post of ours: JobKeeper Payments: How do I participate?