What is it?
The JobKeeper Subsidy Payment is a wage subsidy to be paid to Businesses, Sole Traders, Businesses Without Employees, Not for Profits and Charities, who have experienced a loss of at least 30 percent of their turnover relative to a comparable period a year ago (of at least a month).
These payments are designed to keep employees on the payroll and keep paying them. Businesses will be required to prove that they are using the funds to subsidise wage payments to their employees and have a legal obligation to retain the employee.
Who gets the money, how much and when?
The payment will be made to employers at a flat rate of $1,500 per fortnight from 30th March 2020 for all employees that were employed as of 1st March 2020. Payments will be made from the first week of May backdated to 30th March and will continue for a maximum of 6 months.
How do I register?
Businesses can register their interest in applying for “JobKeeper Payment” via ato.gov.au.
What must the employer do?
· Register an intention to apply on the ATO website. May Klye & Associates can help you with that. This is then followed by an on-line application at some time in the future.
· Demonstrate that your business has or will experience a 30% turnover decline.
Provide the ATO with information on eligible employees employed as at 1st March 2020 (including those stood down or rehired since).
Ensure eligible employees will receive, at a minimum, $1,500 per fortnight, before tax.
Notify all eligible employees that they are receiving the JobKeeper Subsidy Payment.
Continue to provide information to the ATO on a monthly basis, including the number of eligible employees employed by the business.
Which employees are eligible? Eligible employees are employees who:
· are currently employed by the eligible employer (including those stood down or re-hired),
· were employed by the employer at 1st March 2020,
are full-time, part-time, or long-term casuals (a casual employed on a regular basis for longer than 12 months as at 1st March 2020),
are at least 16 years of age,
are an Australian citizen, 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, and
are not in receipt of a JobKeeper Subsidy Payment from another employer.
What about businesses without employees?
Businesses without employees will need to provide an ABN for their business, nominate an individual to receive the payment and provide that individual’s Tax File Number and provide a declaration as to recent business activity. People who are self-employed will need to provide a monthly update to the ATO to declare their continued eligibility for the payments. Payment will be made monthly to the individual’s bank account.
What if the employee has been stood down?
If the employee was employed as of 1st March 2020 the employer remains eligible to reinstate the employee and receive the payment.
What if the employee has been made redundant?
If the employee was employed as of 1st March 2020 the employer remains eligible to reinstate the employee and receive the payment. The government has noted that leave entitlements paid as part of the redundancy are yet to be worked through.
Is superannuation payable on the JobKeeper Subsidy Payment?
If the employee is usually paid $1,500 or more per fortnight before tax, the employer is required to pay superannuation on their full wage, irrespective of the receipt of the $1,500 supplement.
If an employee earns less than $1,500 per fortnight before tax, the employer is only required to pay superannuation on the amount the employee earned as their normal wage, not on the additional amount received as part of the $1,500 payment that is in excess of the normal pay.
If my employee works part time and is usually paid less than $1,500 per fortnight, does the business still receive the full $1,500 per fortnight?
Yes, the employer will receive the full $1,500 per fortnight for the employee and the full $1,500 is required to be passed onto the employee.
If my employee earns more than $1,500 per fortnight, does the business receive more than the $1,500 per fortnight?
No, it is a flat $1,500 per employee, per fortnight, regardless of their income level.
What if the employee has already applied for support through Centrelink?
Provided the employee was employed as of 1st March 2020 they can transition back to the employer and be eligible for the payment, however the employee receiving the JobKeeper Subsidy Payment is not eligible to also receive the JobSeeker payment. They should advise Services Australia of their change in circumstances online at my.gov.au or by telephone.
My employee works has two jobs. Do they receive two payments of $1,500?
No, an employee may only receive the JobKeeper Subsidy Payment from one employer.
Are casuals eligible?
If the casual has been employed with the employer for 12 months or more they will be eligible for the payment.
Are those on temporary work visas eligible?
The government has advised New Zealanders on 444 Visas are eligible for the payment. All other temporary visa holders will not be eligible.
If you need advice on the tax changes, you can contact Noel May or Amanda Klye of May Klye & Associates on (03) 9585 7555 or firstname.lastname@example.org.