JobKeeper No 2
The government announced this week that the JobKeeper program will continue for a further 6 months taking the program through until March 2021. The decision to continue the program was made after a 3 month review of the program.
Initially designed to finish on 28 September 2020 the review concluded there was a very strong case for continuing the program. As such the program has been extended to the end of March 2021, however with some changes.
The changes relate to:
- A reduction in payments from a flat $1,500 per fortnight
- The introduction of a two-tiered payment system under which part-time employees receive a lower payment; and
- A new decline in turnover test using actual rather than projected turnover
There are no changes proposed to the existing JobKeeper arrangements, the changes come into effect in stage 2.
The new stages are
- Stage 1 will end on 28 September 2020
- Stage 2 which will run from 28 September 2020 to 3 January 2021
- Stage 3 which will run from 3 January 2021 to 28 March 2021
The new reduced two-tiered rates will be
- Stage 2: $1,200 for full rate workers and $750 partial rate workers
- Stage 3: $1,000 for full rate workers and $650 partial rate workers
The rate relates to those workers actively engaged in the business for more than 20 hours per week (Full rate) and those workers actively engaged in the business for less than 20 hours per week (Partial rate)
New Decline in Turnover Test
The new rules will require businesses to continue to meet the modified decline in turnover test from September 2020 to March 2021.
To be eligible for JobKeeper No2 the new turnover test rules are:
- Stage 2 – businesses will need to demonstrate that their actual GST turnover has declined by the requisite percentage in both the June and September 2020 quarters, relative to the corresponding quarters in 2019
- Stage 3 – businesses will need to demonstrate that their actual GST turnover has declined by the requisite percentage in both the June, September and December 2020 quarters, relative to the corresponding quarters in 2019
The Commissioner will continue to have discretion to set out alternative tests where the actual GST turnover in 2020 is not comparable to the actual GST turnover for the equivalent quarter in 2019.
Businesses will be able to use their reported BAS details to determine their eligibility.
Eligibility will also shift from projected GST turnover to an actual GST turnover
No changes to other aspects of the program
There are no changes expected for other aspects of the JobKeeper program including:
- Must satisfy the wage condition – by paying their employees an amount in the fortnight that is at least equivalent to the JobKeeper rate – either full rate or partial rate
- The decline in turnover tests remain the same 30% for entities with a turnover of less than $1B and 50% for entities above $1B, 15% for ACNC registered charities
- Commissioners alternative decline in turnover test
- Special rules re service entity arrangements
- Enrolment process
- Payments being made by the ATO in arrears
- Monthly reporting of turnover
What if you don’t qualify for JobKeeper? What assistance is there to help your business re-emerge from the Covid-19 pandemic?
DFK Benjamin King Money has many highly skilled Business Advisors who can assist you. We understand the Pandemic is very challenging and we are here to help and assist. We have access to business development programs specifically designed to assist businesses as they face the challenges of re-emerging from the Covid-19 pandemic. We care about you and your business and we are best placed to assist in your recovery.
Further details of JobKeeper No 2 will be made available once legislation details released an we expect the ATO to release updated guidance as well
Your DFK Benjamin King Money representative will contact you shortly to work with you on all aspects of JobKeeper No 2 and how it affects you and your business
If you require further information on the above and how it impacts you, please do not hesitate to contact our office