It has been three months since we first brought you information on the JobKeeper Package. As Australia continues to struggle with the COVID-19 pandemic and the associated challenges it brings, Cloud Plus is doing its best to provide our valued Partners and Clients with as much support as possible.
In addition to the direct support our dedicated team has been providing, we are also keen to ensure that Partners and Clients are making effective use of initiatives like the JobKeeper Package. There have recently been some updates to this initiative and in this blog post we hope to share the essential details so that you can best capitalise on the benefits available for your business.
As with the previous article regarding the JobKeeper Package, the content below has been syndicated in cooperation with Modoras, a highly-valued client and Cloud Plus’s accountants for many years. We trust it will prove to be informative for many of you.
Starting from 28 September, the current $1,500 per fortnight JobKeeper payment will be reduced to $1,200 per fortnight, and $750 per fortnight for employees who work less than 20 hours per week.
The scheme will change again from 4 January, with the rate falling to $1,000 per fortnight and $650 for people working less than 20 hours a week. This program will run through till 28 March 2021, taking the entire JobKeeper scheme to a total of $86 billion.
This change in payments comes in the wake of complaints about the flat rate payment, as a quarter of JobKeeper recipients received an income rise.
|Hours worked per week||Current Payment until 27 September 2020||28 September 2020 –
3 January 2021
|4 January 2021 –
28 March 2021
|Less than 20||$1,500
|20 or more||$1,500
New eligibility tests
These changes come along with new eligibility tests for businesses wishing to remain on JobKeeper payments post September:
- Business will need to demonstrate an ongoing significant decline in turnover using actual GST turnover rather than projected GST turnover.
- From 28 September – businesses will be required to show at least a 30% drop in turnover for the September quarter, compared to the same period in the prior year
- From 4 January 2021 – business will need to reassess turnover to demonstrate the decline in turnover test has been met for the December 2020 quarter.
- Alternative tests at the discretion of the Commissioner of Taxation will still be in effect.
|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% (15% for ACNC-registered charities, 50% for large businesses) compared to the same period in 2019.*||Actual GST turnover in the September 2020 quarters fell by at least 30% (15% for ACNC-registered charities, 50% for large businesses) compared to the same periods in 2019.
The decline needs to be met to continue receiving JobKeeper payments.
|Actual GST turnover in the December 2020 quarter fell by at least 30% (15% for ACNC-registered charities, 50% for large businesses) compared to the same period in 2019. The decline for the quarter needs to be met to continue receiving JobKeeper payments.|
Note: Many businesses use their Business Activity Statement (BAS) reporting to assess eligibility. BAS deadlines are generally not due until the month after the end of the quarter, therefore eligibility for JobKeeper will need to be assessed before BAS reporting deadlines.
Assessing if an employee has worked 20 hours or more
Post the JobKeeper changes effective 28 September 2020, payments will be at the lower rate for those employees who worked less than 20 hours per week on average. The period assessed will be the four weeks of pay periods before 1 March 2020.
Alternative tests may be set by The Commissioner of Taxation for those situations where an employee’s or business participant’s hours were not considered usual during February 2020. The ATO will also provide guidance for those employees where pay periods are not weekly.
Do the changes effect my JobKeeper payments between now and September?
The current JobKeeper eligibility test remains until the change of eligibility comes into effect on 28 September 2020. So if your business and your employees have passed the original eligibility tests, and the business has continued to pay employees appropriately, JobKeeper will continue to be claimed until 27 September 2020.
What’s the forecast?
There is currently 3.5 million workers receiving JobKeeper payments. The Treasury predicts this to fall to 1.4 million workers from December 2020 and 1 million from March 2021.
Prime Minister Scott Morrison has spoken out about the adverse incentives of JobKeeper, and the need for a two-tiered system as the economy recovers to ensure the payments do not become a dampener on incentives to work.
The changes have been spread out over coming quarters, designed to given business time to adjust to new payment protocols.
If you are already receiving JobKeeper payments, they will remain the same until 27 September 2020 when the new changes come into effect.
More information can be found on the Treasury website here.
Want to know more?
As Government stimulus measures are frequently changing, we are continually updating and creating new tools and information for you. To review the latest materials on COVID-19, please click here. This page will be regularly updated, so please check back in from time to time.
Although Modoras may be working remotely, they are operating as business as usual, and are here to take care of you. If you have further queries please contact Modoras on on (07) 3219 2555 or contacts listed below
IMPORTANT INFORMATION: This blog has been prepared by Modoras Accounting (QLD) Pty. Ltd. ABN 81 601 145 215. The information and opinions contained in this blog is general information only and is not intended to represent specific personal advice (Accounting, taxation, financial, insurance or credit). Find out more information on https://modoras.com/jobkeeper-2-0-changes-from-september/