JobKeeper applications open 20 April 2020
Application and enrolment for the JobKeeper program opened on Monday 20 April through ATO online platforms. Over the past week we have now received the rules and explanatory material from Treasury outlining eligibility criteria and thresholds. Furthermore, the ATO has created their own webpage with some explanation and forms.
These websites can be found here:
As a reminder, the basic criteria for an employer to be eligible are:
- They were in business and had employees at 1 March 2020,
- They have generated business income since 1 July 2018,
- They have either lodged their 2019 tax return or a BAS since 1 July 2018,
- The business has suffered a turnover decline of 30%, or 50% if aggregated turnover is over $1B AUD,
- An ACNC registered charity has a turnover decline threshold of 15%, except for non-Government schools and universities, who need to meet either 30% or 50% still.
Eligible employees needed to be employed at 1 March 2020 and be;
- Full time,
- Part time,
- If casual, employed on a regular and systematic basis for at least 12 months,
- Be an Australian citizen, Australian tax resident, permanent visa holder or NZ citizen on a Subclass 444 Visa.
More information on residency requirements for non-citizens is here.
There is a form for employer and employee to complete here.
Other key points:
- Employers only need to meet the turnover decline test once. They do not need to re-test each month. Note that there is anti-avoidance in place for people who artificially contrive their circumstances to get the payments.
- If the turnover decline is not met now, an employer can enter the program at a later date if the threshold is met then.
- There is a ‘basic’ test to prove decline in turnover, which is comparing a current month in 2020 with the same month in 2019 (March or April for now), or comparing the June quarter 2020 to 2019.
- If the ‘basic’ test is failed, including because the business didn’t exist 12 months ago, then there is an alternative test where the business will need to prove that the same month prior year is not a fair comparison point. The ATO will issue further guidance on this alternative test “soon”.
- The program will still end on 27 September for everyone regardless of when they enter it.
- Employers need to pay a minimum $1,500 per fortnight before tax for eligible employees. Therefore, tax will need to be withheld on this amount before paying employees.
- Employers need to pay their employees once they are eligible and will be reimbursed by the Government the following month, so they are paid by the Government in arrears.
- Employers must pass on the full benefit of JobKeeper to eligible employees. Asking employees to give some of it back is illegal.
- If a business is eligible, it must inform its employees it is part of the program and pay JobKeeper for all eligible employees. It cannot pick and choose.
- Employees who were employed on 1 March and have since been terminated can be re-hired and immediately stood down and receive JobKeeper payment.
- Employees can only receive JobKeeper from one employer. Therefore, if someone has multiple jobs they need to nominate a primary employer.
- A person with a casual position and a permanent position cannot nominate their casual employer.
- Superannuation Guarantee is not payable on any excess payment that is attributable to JobKeeper payment.
- There will be monthly reporting requirements with the ATO.
Sole traders and businesses without employees are also eligible for the program, although for the latter only one person can be nominated to receive the payment, which includes partnerships. They have the same eligibility criteria as businesses with employees and will need to register for the Business Portal if they haven’t already done so.