15th APRIL 2020

The ATO have now started releasing more information on the JobKeeper Scheme criteria and the steps to be taken to assess your business eligibility and apply for approval. In summary the steps are for the Tax Agent or business to:

• Work out if you are eligible
• Identify your eligible employees
• Ensure you correctly pay the eligible employees
• Enrol your business with the ATO
• Apply on behalf of your business

1. You will be eligible for the JobKeeper payment if:

• on 1 March 2020, you carried on a business in Australia
• employed at least one eligible employee on 1 March 2020 or self-employed
• the eligible employees are currently employed by the business for the fortnights you start to claim for, and continue to claim for (including those who are stood down or re-hired)
• the business has faced a
  • 30% fall in turnover (if their aggregated turnover is $1 billion or less)
  • 50% fall in turnover (if their aggregated turnover is more than $1 billion)
• pay the eligible employees at least $1,500 before tax for the fortnights you start to claim for, and continue to claim for
• you successfully enrol for the JobKeeper scheme and apply for JobKeeper payments.

Some Sole traders and business participants (i.e. business owners) are also entitled to the JobKeeper payment.

1. Identify your eligible employees

You are eligible for the JobKeeper payment in respect of employees if the employees:

• are currently employed by you (including those stood down or re-hired)
• are either
  • permanent full-time or part-time employees (or of another entity in your wholly owned group) who were employees as at 1 March 2020
  • casually employed on a regular basis for at least 12 months as at 1 March 2020 and not a permanent employee of any other employer
• were at least 16 years of age as at 1 March 2020
• were an Australian resident as at 1 March 2020 and are one of an Australian citizen, the holder of a permanent visa, a Protected Special Category Visa Holder
• were not in receipt of either:
  • government parental leave
  • a payment for worker compensation due to total incapacity for work
• have not agreed with any other employer to be nominated as an eligible employee for the JobKeeper payment (no double dipping)
• complete the JobKeeper employee nomination notice.

1. Ensure you correctly pay your eligible employees

You should pay the eligible employees in line with their existing pay amounts and pay cycle and meet these requirements:

• You should pay the minimum $1,500 before tax to each eligible employee each fortnight (starting with the fortnight 30 March – 12 April) to claim the JobKeeper payment for that fortnight.
• You need to continue to pay employees you are claiming for either
  • every subsequent fortnight until 27 September 2020
  • until the employees stop being eligible or you opt out.
• For the first two fortnights (30 March – 12 April and 13 April – 26 April), the ATO will accept the minimum $1,500 payment before tax has been paid for each fortnight even if it has been paid late, provided it is paid by the end of April.
• If your eligible employees earn less than $1,500 per fortnight before tax, you must pay them $1,500 per for each fortnight to claim the JobKeeper payment. This ‘top up’ of their salary or wages will ensure they remain eligible.
• Employers cannot pay their employees less than $1,500 before tax per fortnight and keep the difference.
• You will not be eligible for the JobKeeper payment if you pay the nominated employee less than $1,500 before tax per fortnight.
• If the employees earn more than $1,500 per fortnight, you will only receive $1,500 for each eligible employee and you should pay any additional balance as per normal pay terms.
• If an employee has been stood down after 1 March, and you re-engage them, you must pay the eligible employee at least $1,500 per fortnight before tax. You will only be eligible to claim for the fortnights after you have re-engaged the employee within the pay period.
• If an employee was employed on 1 March 2020, subsequently ceased employment with you as employer, and has since been re-engaged by you, the employee must receive, at a minimum, $1,500 per fortnight, before tax.
• You cannot claim the reimbursement for the JobKeeper payment for employees who were not paid the full amount during each JobKeeper payment period (starting March 30)
• If your ordinary arrangement is to pay employees less frequently than fortnightly, the payment can be allocated between fortnights in a reasonable manner. For example, you pay an employee every four weeks, it is acceptable if the employee is paid at least $3,000 for every four-week period.
• The JobKeeper payment is a reimbursement from the ATO to you and cannot be paid in advance, it will be paid the following month.

All JobKeeper payments are taxable income of the business and normal rules for deductibility apply for amount a business pays to its employees where those amounts are subsidised by the JobKeeper payment, essentially tax neutral. The JobKeeper payment is not subject to GST.

New (temporary) rules are being introduced to not require super guarantee to be paid on any additional payments that are made to employees as a result of JobKeeper payments, i.e. if an employee is normally paid less than $1,500.00 p.f. the super guarantee is only payable on the normally fortnightly earnings.

1. Enrol your business with the ATO

• Step 1 – Enrol for JobKeeper from 20 April 2020 using the ATO Online services for tax agents or your myGov portal and authenticate with myGovID.
• Step 2 – In the online form, provide your bank details and confirm if you are entitled to a business participation payment, i.e. for business owners who are not employees.
• Step 3 – Specify the number of employees who will be eligible for one period and the number eligible for two periods (3o March – 12 April and 13 April to 27 April)
• Step 4 – Provide confirmation the employees you plan to nominate are eligible and that the employer has notified them and has their written agreement.
• Step 5 – Enrol through ATO Online services for agents or your myGov login.

1. Apply on behalf of your business

• Step 1 – Apply to claim the JobKeeper payment by logging into the ATO Business Portal/Online services for agents or business myGov between 4 May 2020 and 31 May 2020.
• Step 2 – Ensure you paid the eligible employees and have received their JobKeeper employee nomination notices.
• Step 3 – Identify the eligible employees by either
  • selecting employee details that are prefilled from the STP pay reports if you report payroll information through an STP enabled payroll solution
  • manually entering employee details in ATO Online services for agents or the Business myGov if you do not use an STP enabled payroll solution.
• Step 4 – Submit a report through ATO Online services for agents.
• Step 5 – Ensure you notify you eligible employees of their nomination.
• Step 6  – The ATO will pay you the JobKeeper payment for all eligible employees to your business bank account after receiving your application.
• Step 7 – Each month, you will need to reconfirm your reported eligible employees have not changed through ATO online services, the Business myGov or via your registered tax agent. This will ensure you will continue to receive the JobKeeper payments from the ATO. You do not need to “retest” your reported fall in turnover, but you will need to provide information on each month’s current and projected turnover. This will be done in your monthly JobKeeper Declaration report.

• Step 8 – If your eligible employees change or leave your employment, you will need to notify the ATO through your monthly JobKeeper Declaration report.

To clarify, you can “enrol” in the JobKeeper program from 20^th April onwards, but you then also need to “apply” to the ATO after 4^th May.

If this seems confusing or daunting MyAccountants are authorised by the ATO to do the enrolment and application through our Tax Agents portal on your behalf. We can also prepare and lodge the monthly JobKeeper Declaration reports through to September 2020 on your behalf. If you want to discuss our enrolment service please give us a call for details. Don’t delay as your payments could be delayed or reduced if you miss the application deadlines.

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