The Government is extending the JobKeeper Payment by a further six months to 28 March 2021. Under the JobKeeper extension, support will be targeted to businesses and not-for-profits that continue to be significantly impacted by the Coronavirus. The payment rate will be reduced and a lower payment rate will be introduced for those who work fewer hours. Other eligibility rules remain unchanged.
JobKeeper Extension Summary
- JobKeeper has been extended to eligible businesses until 28 March 2021;
- Eligible businesses will need to reassess their eligibility based on June and September 2020 quarterly income;
- A second eligibility assessment must also be made to receive JobKeeper between 4 January and 28 March 2021 (based on actual turnover for the December 2020 quarter);
- JobKeeper payment rates will be reduced and lower payments will apply to part-time employees who worked less than 20 hours per week prior to COVID-19;
- Eligibility and payments remained unchanged for any business already receiving JobKeeper for eligibile employees up to 27 September 2020.
JobKeeper Extension Eligibility
From 28 September 2020, businesses will be required to reassess their eligibility with reference to their actual GST turnover in the June and September quarters 2020.
Businesses will need to demonstrate that they have met the relevant decline in turnover test in both of those quarters to be eligible for the JobKeeper Payment from 28 September 2020 to 3 January 2021.
From 4 January 2021, businesses will need to further reassess their turnover to be eligible for the JobKeeper Payment.
They will need to demonstrate that they have met the relevant decline in turnover test with reference to their actual GST turnover in each of the June, September and December quarters 2020 to remain eligible for the JobKeeper Payment from 4 January 2021 to 28 March 2021.
JobKeeper additional decline in turnover tests are also available from 28 September 2020. See below.
JobKeeper 2.0 Payment Rates
- Prior to 27 September 2020 – $1500 per fortnight
- 28 September 2020 to 3 January 2021 – $1200 per fortnight
- 4 January 2021 to 28 March 2021 – $1000 per fortnight
JobKeeper Payments for Part-Time and Casual Employees
As part of the JobKeeper extension, from 28 September 2020, lower payment rates will apply for employees and business participants that worked fewer than 20 hours per week.
The JobKeeper extension payment rates for part-time eligible employees will be:
- Prior to 27 September 2020 – $1500 per fortnight
- 28 September 2020 to 3 January 2021 – $750 per fortnight
- 4 January 2021 to 28 March 2021 – $650 per fortnight
JobKeeper Full-Time Employee
Definition of a full-time employee or eligible business participant for JobKeeper payments is based on whether they’ve worked more than 20 hours per week or more.
For an employee to be determined as being full-time they need have to have worked on average more than 20 hours per week for the four weeks of pay periods before 1 March 2020 (i.e. in February 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 2020. Also, the ATO will provide guidance on how this will be dealt with when pay periods are not weekly.
Additional JobKeeper Extension Decline in Turnover Tests
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% compared to the same period in 2019.*||Actual GST turnover in the June and September 2020 quarters fell by at least 30% compared to the same periods in 2019.
The decline for both of the quarters needs to be met to continue receiving JobKeeper payments.
|Actual GST turnover in the June, September and December 2020 quarters fell by at least 30% compared to the same periods in 2019.
The decline for all three of the quarters needs to be met to continue receiving JobKeeper payments.
*The alternative tests will apply where a business fails the basic test and does not have a relevant comparison period.
The 30% decline in turnover test for JobKeeper is adjusted to 15% for ACNC-registered charities (excluding universities, or schools within the meaning of the GST Act – these entities need to meet the basic turnover test) and 50% for large businesses with an annual turnover of $1 billion or more.
The ATO 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 JobKeeper eligibility tests will be in line with the existing discretion from the ATO. More information from the ATO is available here: How to determine a fall in turnover
Assessing JobKeeper 2.0 Eligibility
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.
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).
JobKeeper Prior to 27 September 2020
Eligibility and payments remained unchanged for any business already receiving JobKeeper for eligible employees up to 27 September 2020.
The “once you’re in, you’re in” approach still applies through so provided your business met the eligibility test once since the commencement of JobKeeper, you continue to be eligible through to 27 September 2020 providing your fulfill the monthly statistical reporting and wage payment requirement.
Re-assessment is only necessary to receive JobKeeper after 27 September 2020 and then again after 3 January 2020.
Other JobKeeper Related Articles
If you have any questions, please get in touch with your Quill Relationship Manager or reach out to our team for assistance.