JobKeeper Payment – updates and changes
On Tuesday 21 July, the Australian Government announced the welcome news for many… that the JobKeeper Payment to support businesses and their employees impacted by COVID-19, would be extended with some amendments.
The extension of the JobKeeper Payment scheme will now run through to 28 March 2021. The changes to the scheme will come into effect from 28 September 2020, when the current scheme commitment ends. The Government announced further updates to the scheme on 7 August 2020.
What is the JobKeeper Payment?
The JobKeeper Payment scheme is a temporary subsidy for businesses significantly affected by coronavirus (COVID-19). The original scheme was announced in March 2020 with affected employers, sole traders and other entities being able to claim a fortnightly payment of $1,500 per eligible employee backdated from 30 March for a period of 6 months.
Changes to JobKeeper Payment
The JobKeeper Payment, which was originally due to run until 27 September 2020, will now continue to be available to eligible businesses (including the self-employed) and not-for-profits until 28 March 2021. The current $1,500 fortnightly payment rate for eligible employees and business participants will reduce to $1,200 from 28 September 2020 and again to $1,000 from 4 January 2021 . View the JobKeeper Payment Fact Sheet.
From 28 September 2020
- lower payment rates will apply for employees and business participants that worked fewer than 20 hours per week. The current system enables people to work any number of hours to be eligible for the full amount.
- ongoing significant decline in turnover is required to be demonstrated by businesses and not-for-profits. This must be calculated using actual GST turnover, rather than projected GST turnover, for the previous quarter to be eligible for the Payment from 28 September 2020 to 3 January 2021. (*Update at 7 August 2020, removed the requirement for a decline in multiple quarters, and now only need to show a decline in turnover from the previous quarter).
From 4 January 2021
- businesses and not-for-profits will need to further reassess their eligibility and demonstrate they have met the relevant decline in turnover test with reference to their actual GST turnover in the previous quarter to continue to receive the Payment from 4 January 2021 to 28 March 2021. (*Update at 7 August 2020, removed the requirement for a decline in multiple quarters, and now only need to show a decline in turnover from the previous quarter).
Decline in turnover
To be eligible, entities are required to continue to demonstrate they have experienced decline in turnover each quarter. The level of decline required for eligibility is based on aggregated turnover:
- 50% decline for businesses with an aggregated turnover of more than $1 billion.
- 30% decline for businesses with an aggregated turnover of $1 billion or less.
- in the case of charities and not-for-profits, a decline of 15%.
An entity’s eligibility prior to 28 September 2020 will not be affected if the additional turnover tests for the extension period are not met.
JobKeeper Payment rates
- eligible employees who, in the 4 weeks of pay periods before 1 July 2020, were working for 20+ hours per week on average. (*Update at 7 August 2020, this eligibility test date moved from 1 March 2020, to 1 July 2020 with the new reference date to apply for the last four fortnights of the legislated scheme as well as the duration of the proposed extended period. Staff who were hired after 1 March 2020 may now be eligible for JobKeeper).
- eligible business participants who, in the month of February 2020, were actively engaged in the business for 20+ hours per week on average.
The reduced payment rate applies to all other eligible employees and business participants.
- Full payment rate will be $1,200 per fortnight.
- Reduced payment rate will be $750 per fortnight.
- Full payment rate will be $1,000 per fortnight.
- Reduced payment rate will be $650 per fortnight.
Understand your obligations and eligibility
If you would like more information regarding the JobKeeper Payment and managing this for your business, contact us. Get in touch today to discuss your particular situation via email, or call 07 3348 3666 and we’ll be ready to assist.