Job Keeper Program (Updated 14th April 2020) - 4 Step Process
14th February 2020 - Use this 4 step process to find out if you are eligible for the Job Keeper payment.
1. Are You an Eligible Employer?
Who Is Eligible?
Employers will be eligible for the JobKeeper payment if all of the following apply:
On 1 March 2020, you carried on a business in Australia or were a not-for-profit organisation that pursued your objectives principally in Australia.
You employed at least one eligible employee on 1 March 2020.
Your eligible employees are currently employed by your business for the fortnights you claim for (including those who are stood down or re-hired).
Your business has faced a
30% fall in turnover (for an aggregated turnover of $1 billion or less)
50% fall in turnover (for an aggregated turnover of more than $1 billion), or
15% fall in turnover (for ACNC-registered charities other than universities and schools).
Sole traders can be eligible for the JobKeeper payment if their business has experienced a downturn according to the eligibility criteria
Company, Trusts or Partnerships
Other businesses in the form of a company, trust or partnership can also qualify for JobKeeper payments where a business owner (a shareholder, adult beneficiary or partner) is actively engaged in the business, or a director is actively engaged in the business. This is limited to one entitlement for each entity even if there are multiple business owners or participants.
Who Is Ineligible?
An employer is not eligible for the JobKeeper payment if:
the Major Bank Levy was imposed on the entity or a member of its consolidated group for any quarter before 1 March 2020
the entity is an Australian government agency (within the meaning of the Income Tax Assessment Act 1997)
the entity is a local governing body
the entity is wholly owned by an Australian government agency or local governing body
the entity is a sovereign entity
the entity is a company in liquidation
the entity is an individual who has entered bankruptcy.
How Do You Calculate a Fall In Turnover?
To work out your fall in turnover, you can compare either:
GST turnover for March 2020 with GST turnover for March 2019
projected GST turnover for April 2020 with GST turnover for April 2019
projected GST turnover for the quarter starting April 2020 with GST turnover for the quarter starting April 2019.
2. Do You Have Eligible Employees?
Your employee is eligible under the Job Keeper Payment scheme if they:
are employed by you (including those stood down or re-hired)
were either a
permanent full-time or part-time employee at 1 March 2020
long-term casual employee (employed on a regular and systematic 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 on 1 March 2020
were an Australian resident as at 1 March 2020 within the meaning of the Social Security Act 1991
were not in receipt of any of these payments during the Job Keeper fortnight
government parental leave or Dad and partner pay
a payment in accordance with Australian worker compensation law for an individual’s total incapacity for work
agree to be nominated by you
Employees cannot receive the Job Keeper payment from more than one employer.
Before you enrol to receive Job Keeper payments, you need to notify each eligible employee that you intend to nominate them as eligible employees under the Job Keeper scheme.
The nomination form does not need to be provided to the ATO however employers are required to keep a copy of the completed form as part of their record keeping obligations under the law.
3. Have You Paid Your Eligible Employees?
How to pay
You need to re-start or continue to pay your eligible employees at least $1,500 a fortnight in line with your existing pay cycle through your existing payroll solution.
When to pay
You should pay your employees for each JobKeeper fortnight you plan to claim for. The first fortnight is from 30 March – 12 April and each JobKeeper fortnight follows after that.
For the first two fortnights (30 March – 12 April, 13 April – 26 April), we will accept 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.
If your eligible employees change or leave your employment, you need to notify us.
How much to pay
You must pay the minimum $1,500 before tax to each eligible employee per fortnight to claim the JobKeeper payment for that fortnight.
If your eligible employees earn less than $1,500 per fortnight before tax, you must pay them at least $1,500 for each fortnight to claim the JobKeeper payment. This is a ‘top up’ of their salary or wages and will ensure they remain eligible.
You cannot pay your employees less than $1,500 per fortnight and keep the difference. You will not be eligible for the JobKeeper payment if you pay your nominated employee less than $1,500 before tax per fortnight.
If your eligible employees earn more than $1,500 per fortnight, you should continue to pay them their regular salary or wages. However, you will only receive $1,500 for each eligible employee. Any amount you pay above $1,500 per fortnight is not subsidised by the JobKeeper payment.
If an employee has been stood down after 1 March 2020, you can start paying them $1,500 per fortnight to qualify for the JobKeeper payment for that employee.
If an employee ceased working for you after 1 March 2020, you can re-engage them and pay them at least $1,500 per fortnight. You will only be eligible to claim for the fortnights after you re-engaged your employee.
If you usually pay your employees monthly, the payment can be allocated between fortnights in a reasonable manner. For example, if you pay your employees on a four-week pay cycle, your employees must have received at least $3,000 for every four-week period.
All JobKeeper payments are assessable income of the business that is eligible to receive the payments. The normal rules for deductibility apply in respect of the amounts your business pays to its employees where those amounts are subsidised by the JobKeeper payment.
The JobKeeper payment is not subject to GST.
New rules are being introduced by the government with the intention to not require super guarantee to be paid on additional payments that are made to employees as a result of JobKeeper payments.
4. Have you enrolled for the Job Keeper Program?
Enrol for the JobKeeper payment (from 20 April onwards)
Step 1 – Register your interest and subscribe for JobKeeper payment updates.
Step 2 – Check you and your employees meet the eligibility requirements.
Step 3 – Continue to pay at least $1,500 to each eligible employee per JobKeeper fortnight (the first JobKeeper fortnight is the period from 30 March to 12 April).
Step 4 – Notify your eligible employees that you are intending to claim the JobKeeper payment on their behalf and check they aren’t claiming JobKeeper payment through another employer or have nominated through another business.
Step 5 – Send the JobKeeper employee nomination notice to your nominated employees to complete and return to you by the end of April if you plan to claim JobKeeper payment for April. Keep it on file and provide a copy to your registered tax agent if you are using one.
Step 6 – From 20 April 2020, you can enrol with us for the JobKeeper payment using the Business Portal and authenticate with myGovID. You must do this by the end of April to claim JobKeeper payments for April.
Step 7 – In the online form, provide your bank details and indicate if you are claiming an entitlement based on business participation, for example if you are a sole trader.
Step 8 – Specify the estimated number of employees who will be eligible for the first JobKeeper fortnight (30 March – 12 April) and the second JobKeeper fortnight (13 April – 26 April).
Confirmation of eligible employees you will claim JobKeeper Payment for (available from 4 May 2020 onwards)
Step 1 – Apply to claim the JobKeeper payment by logging in to the ATO Business PortalExternal Link
Step 2 – Ensure you have paid each eligible employee a minimum of $1,500 per JobKeeper fortnight before tax.
Step 3 – Identify your eligible employees in the application form by
- selecting employee details that are prefilled 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, or
using a registered tax agent who will submit a report on your behalf through Online services for agents.
Step 4 – Submit the confirmation of your eligible employees online and wait for your confirmation email or SMS showing it has been received.
Step 5 – Notify your eligible employees you have nominated them.
Step 6 – We will pay you the JobKeeper payment for all eligible employees after receiving your application.
Step 7 – Each month, you will need to reconfirm that your reported eligible employees have not changed through ATO online services, the Business Portal or via your registered tax agent. This will ensure you will continue to receive the JobKeeper payments from us. You do not need to retest your reported fall in turnover, but you will need to provide some information as to your 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 us through your monthly JobKeeper Declaration report.
source - ato.gov.au
What Do You Need to Do Next?
Checklist to ensure you are prepared:
Work out if you are eligible
Work out who your eligible employees are
Ensure you have obtained your employees consent for nomination
Ensure you Accounting and payroll system is setup for Job Keeper payments
Ensure you have made Job Keeper payments to your employees for a minimum of $1,500 per fortnight from 30th March
Ensure you enrol for the Job Keeper payment from 20th April onwards
Ensure you make the claim from 4th May onwards
This is the time you should be working with your advisors to plan what you need to do.
If you are not sure if you are eligible or what the process is, reach out to us for more information here at firstname.lastname@example.org