The first phase of JobKeeper was designed to get money out to businesses as quickly as possible. An unintended consequence of this was some employees being paid more on JobKeeper than they had been before COVID. Businesses were also able to access JobKeeper if they satisfied the turnover test at any point during COVID, however going forward, there will be much greater scrutiny on changes in revenue.
From 28 September 2020
– employers need to demonstrate that their actual GST turnover has fallen against a comparable period
– tier 1 and tier 2 JobKeeper rates apply and are generally based on average hours worked by employees.
For the JobKeeper fortnights starting 28 September 2020 and 12 October 2020 only, the ATO are allowing employers until 31 October 2020 to meet the wage condition for all employees included in the JobKeeper scheme.
Employers do not need to re-enrol to claim payments in the first extension if they are already enrolled in JobKeeper. They just need to check their continuing eligibility and submit this information to the ATO online to the ATO from 1 October 2020.
Employers also need to tell the ATO the payment tier they are claiming for each eligible employee or business participant in their November monthly business declaration.
The current turnover test has been substantially tightened for each quarter.
To qualify for the December 2020 JobKeeper, businesses must meet the decline in turnover test for the September 2020 quarter.
To qualify for the March 2021, JobKeeper, businesses must meet the decline in turnover test for the December 2020 quarter.
The decline in turnover must be determined with reference to actual GST turnover (and not projected GST turnover).
The flat $1,500 payments will be replaced by a new two-tiered payment system to reflect the pre-COVID working hours of employees.
20+ hours a week
<20 hours a week
Until 27 September 2020
$1,500 a fortnight
$1,500 a fortnight
From 28 September 2020
$1,200 a fortnight
$750 a fortnight
From 4 January 2021
$1,000 a fortnight
$650 a fortnight
The test for hours worked (including paid leave and public holiday leave) is now 80 hours per 28 day reference pay period ending before 1 March or 1 July 2020 for employees or 80 hours of active engagement for business participants for February 2020.
Decline in turnover
The actual decline in turnover test is satisfied for JobKeeper extension 1 when your current GST turnover for the quarter ending 30 September 2020 (July, August and September) has declined by the specified shortfall percentage (30%, 50% or 15%) in comparison to your current GST turnover for the quarter ending 30 September 2019.
The actual decline in turnover test is satisfied for JobKeeper extension 2 when your current GST turnover for the quarter ending 31 December 2020 (October, November and December) has declined by the specified shortfall percentage (30%, 50% or 15%) in comparison to your current GST turnover for the quarter ending 31 December 2019.
What is different?
Unlike when you calculated the original decline in turnover test, you do not use your projected GST turnover for the relevant quarter being tested. You use your current GST turnover.
To work out which supplies you have made in the turnover test period, you must use the accounting basis you used for GST reporting purposes. Depending on your circumstances, you could use a cash basis or a non-cash basis.
A GST accounting basis will apply to allocate supplies to a test period regardless of whether:
the supply was a taxable supply
you report GST on a monthly or quarterly basis
For many businesses registered for GST, this calculation will match the ‘total sales’ reported at G1 on your BAS minus GST payable (1A), where applicable.
If you are not registered for GST, you will work out your turnover using either the GST cash or non-cash basis of accounting.
You can provide additional turnover information to demonstrate that you satisfy the actual decline in turnover test for the September quarter from the start of October onwards. You must provide it before you complete your November monthly declaration.
Alternative tests for determining actual decline in turnover may be available in some circumstances. These will apply in a similar way to the alternative tests for the original decline in turnover test. However, they must be applied on the basis that the turnover test period is a quarter. The ATO will publish more information on the alternative tests for the actual decline in turnover test once it is available.
What doesn’t change?
To claim for fortnights in the JobKeeper extension 1 or 2:
You don’t need to re-enrol for the JobKeeper extension if you are already enrolled for JobKeeper for fortnights before 28 September.
You don’t need to reassess employee eligibility or ask employees to agree to be nominated by you as their eligible employer if you are already claiming for them before 28 September.
You don’t need to meet any further requirements if you are claiming for an eligible business participant, other than those that applied from the start of JobKeeper relating to
holding an ABN, and
declaring assessable income and supplies.
New JobKeeper participants
The JobKeeper scheme will remain open to new participants, provided they meet the eligibility requirements for the relevant period.
What you need to do if you are eligible.
From 28 September 2020, you must do all of the following:
work out if the tier 1 or tier 2 rate applies to each of your eligible employees and/or eligible business participants and/or eligible religious practitioners
notify the ATO and your eligible employees and/or eligible business participants and/or eligible religious practitioners what payment rate applies to them
during JobKeeper extension 1 – ensure your eligible employees are paid at least
$1,200 per fortnight for tier 1 employees
$750 per fortnight for tier 2 employees
during JobKeeper extension 2 – ensure your eligible employees are paid at least
$1,000 per fortnight for tier 1 employees
$650 per fortnight for tier 2 employees.
If you are registered for GST and have outstanding BAS statements, you should lodge your BAS for the September 2019 and December 2019 quarters as soon as possible (or for equivalent months, if you report monthly). Un-lodged BAS statements may hold up your application for JobKeeper Payments under the JobKeeper extension.