Step 1: Register your Interest
To ensure you are kept up to date with the most recent information for the JobKeeper payment, ensure you register your interest via the ATO website.
Step 2: Check You & Your Employees are Eligible
Unsure if you are an eligible employer or have eligible employees? Access the flowcharts aimed to help you determine your eligibility for the JobKeeper Payment:
Other entities carrying on a business can be eligible for the JobKeeper payment even if they do not have employees. The entities and the one associated individual that could be eligible include:
- Sole trader—the individual must be the entity
- Partnership—the individual must be a partner in the partnership
- Trust—the individual must be an adult beneficiary of the trust
- Company—either a director or shareholder in the company
How Do I Determine a Fall in Turnover?
To work out your fall in turnover, you can compare either:
- Your actual GST turnover for March 2020 with your GST turnover for March 2019
- Your projected GST turnover for a relevant month in 2020 (between April & September) with your GST turnover for that month in 2019
- your projected GST turnover for a relevant quarter in 2020 (quarters starting April 2020 or July 2020) with your GST turnover for that quarter in 2019
How you choose to project your fall in turnover is not dependent on whether you report a quarterly or monthly BAS, though you can do that if it is easier. You may meet the Turnover Test if your turnover has decreased by 30% or 50% (dependent on your aggregated turnover).
If you don't have a relevant comparison period in the 2019 year (for example your business has only recently started trading), the Commissioner can determine an Alternative Decline in Turnover Test.
Eligibility for the JobKeeper payment commences at the start of a JobKeeper fortnight. To ensure you receive a payment for a fortnight, you need to ensure you have applied for the scheme prior to that fortnight as payments will not be made retrospectively. Note there is an exception for the month of April 2020.
For further information on the Turnover Test, please talk with us.
Step 3: Ensure You Pay $1,500 to Each Eligible Employee Per Fortnight
The JobKeeper Payment is a reimbursement scheme. As a result, you are required to pay the minimum gross payment of $1,500 per fortnight for each JobKeeper fortnight to eligible employees. JobKeeper fortnights start on 30 March 2020 and end on 27 September 2020. Note: You are required to withhold tax from this payment
For the first two fortnights (30 March – 12 April, 13 April – 26 April), the ATO will accept that the minimum $1,500 payment for each fortnight has been paid by you even if it has been paid late, provided it is paid by you by the end of April. This means that you can make two fortnightly payments of at least $1,500 per fortnight before the end of April, or a combined payment of at least $3,000 before the end of April.
If you usually pay your employees less frequently than fortnightly, the payment can be allocated between fortnights in a reasonable manner. For example, if you pay your employees on a monthly pay cycle, your employees must have received the monthly equivalent of $1,500 per fortnight.
Step 4: Notify Your Eligible Employees
You must provide notification to your eligible employees in writing that you have elected to participate in the JobKeeper Scheme within 7 days of enrolling with the ATO. Your employee is required to respond to your nomination agreeing that they wish to be nominated and that they don't receive the JobKeeper payment via another employer.
The ATO have provided a JobKeeper Employee Nomination Notice form that you can complete and provide to each eligible employee.
Each eligible employee will need to complete and return their respective sections to you, which you keep for your records. These forms need to be provided and returned by the end of April 2020 if you plan to claim the JobKeeper payment for April.
Step 5: Apply for the JobKeeper Payment
The application process for the JobKeeper Payment is a two-stage process. This includes Enrollment & Application.
Enrollment for the JobKeeper Payment scheme will be made available on 20 April 2020. If you wish to claim the JobKeeper payment for the month of April, you must enroll by the end of April.
Application for the JobKeeper Payment will be made available on 4 May 2020.
We can assist you with the Enrollment and Application process, or you can complete these via the Business Portal. It is now a requirement to have a myGovID to access the Business Portal. We suggest you register for a myGovID and gain access to the Business Portal if you have not already done so. Follow our step-by-step guide on setting your myGovID in our recent blog. If you have issues with obtaining your myGovID or setting up the business portal, we are happy to assist you with this process.
How Will I Provide Details For My Eligible Employees In My Application?
- Selecting employee details that are pre-filled from your STP pay reports if you report payroll information through an STP enabled payroll solution, or
- Manually entering employee details in ATO online services or the Business Portal if you do not use an STP enabled payroll solution.
How Will I Know If My Application Has Been Approved?
Upon submitting the confirmation of your eligible employees online, you should receive a confirmation email or SMS showing it has been received.
Step 6: Ensure Your Bank Details are Correct
To ensure you receive your JobKeeper Payment, ensure your bank details are correct in the enrollment process. You will also need to indicate if you are claiming an entitlement based on business participation, for example if you are a sole trader.
Step 7: Specify the Estimated Number of Employees
If you plan to claim the JobKeeper Payment for the first two JobKeeper Fortnights (30 March – 12 April and 13 April – 26 April) you must specify the estimated number of employees you intend to claim the JobKeeper Payment for during the Enrollment process.
What Reporting Obligations Will I Have?
If you receive the JobKeeper Payment, there are several reporting obligations, which include:
- Monthly Reporting - you are required to report:
- your current GST turnover for the reporting month; and
- your projected GST turnover for the following month
- Report any changes to employees - if your eligible employees change or they leave your employment, you need to notify the ATO in the next reporting period
- Reporting via Single Touch Payroll (STP) - most of the required employee information is transferred via your STP reporting obligations. If you are not yet setup to report via STP (for example you are a closely-held employer), we suggest you implement STP to ensure your application and reporting processes are streamlined.
Important Factors To Consider
- The JobKeeper payment is a reimbursement scheme to employers - i.e. you must meet the minimum wage requirement of $1,500 gross per fortnight to each employee.
- The JobKeeper payment is a "one in, all in" scheme - i.e. if eligible, you will receive the JobKeeper payment for all eligible employees.
- Once eligible, you are not required to retest your Turnover eligibility - you will continue to receive the JobKeeper payment up until 27 September 2020 for each eligible employee.
- Applications are prospective, not retrospective - i.e. you must apply before the end of a JobKeeper fortnight for the employer to be entitled to a payment for that fortnight.
- Transitional timing rules apply for the first and second JobKeeper payments (fortnights commencing on 30 March 2020 and 14 April 2020). You have until the end of the second JobKeeper fortnight (26 April 2020) to apply for the JobKeeper scheme.
- The JobKeeper Payment is assessable income to your business, however the normal deductibility rules apply to the payment to eligible employees.
- Ensuring you are STP compliant will help with the application process and your reporting obligations under the JobKeeper Scheme. If you are not yet STP compliant, we suggest implementing this as soon as possible.
If you would like to discuss the JobKeeper Payment, our team is available to assist you. Please don't hesitate to talk with us on (02) 4229 2211 or you can send us your enquiry online.