The legislation for the JobKeeper extension has now been passed and we have more clarity on eligibility and practicality. Remember even if you did not qualify for JobKeeper previously you can still enter the system for the next phase.
THIS NEEDS TO BE ADDRESSED AS A PRIORITY BEFORE PROCESSING YOUR PAYROLL IN OCTOBER.
FIRST STEP: BUSINESS ELIGIBILITY
You need to assess whether you are eligible for the extension period 1 which covers October, November and December 2020. The qualification this time is on a quarterly basis. Comparison is made between your September 2020 quarter GST Turnover (as reported on your BAS) and your September 2019 quarter GST Turnover (once again as reported on your BAS).
For those who submit their BAS quarterly this is a simple calculation of comparing the two September BAS to determine if the Sales/Turnover has dropped by 30%. If it has you are eligible, if not sorry your JobKeeper has ceased until the next comparison on your December BAS.
For those who submit monthly BAS you will need to add the July, August and September Sales/Turnover on the BAS for both 2019 and 2020. Once again if the Sales/Turnover has dropped by 30% in 2020 you are eligible. If not, you can reassess based on your December quarter figures for the next phase.
IMPORTANT NOTE: This comparison to determine eligibility must be done promptly in October. If you are eligible you will need to reassess the JobKeeper payments to your staff and amend them accordingly in the next pay period.
SECOND STEP: EMPLOYEE ELIGIBILITY
If you have determined you are eligible for the next phase (JobKeeper 2) you must then determine which staff are eligible. If you have put on any new staff between 1 March and 1 July they may now be eligible depending on their personal circumstances. Generally staff are eligible if they do not have a full time job elsewhere, they are not in receipt of JobKeeper elsewhere and/or they are not in receipt of Government Benefits such as age pension or JobSeeker (these are examples only). They should sign a new confirmation of eligibility if they have not already done so or if their circumstances have changed.
For business participants and sole traders you must be actively involved in your business for the appropriate hours per week. In addition you must not have employment elsewhere.
THIRD STEP: RATE OF PAYMENT
The JobKeeper 2 extension program is now a tiered program with two levels of payment. Those working 80 hours or more in the 28 days prior to 1 March OR 1 July will receive the higher payment of $1200 per fortnight. Those working less than 80 hours in the 28 days prior to March 1 of July 1 will receive the lower payment of $750 per fortnight.
ONCE AGAIN IT IS IMPORTANT THAT YOU DETERMINE YOUR ELIGIBILITY EARLY TO ENSURE THE CORRECT RATE OF PAYMENT IS MADE TO EMPLOYEES.
FOURTH STEP: NOTIFYING THE ATO
If you utilize payroll software, you will need to ensure the changes are made in your software. The software companies have yet to release details of the changes however, once they are released, we will be happy to assist you.
For those not using payroll software you will need to make changes in your October JobKeeper declaration to identify your employees and the rate of payment they are receiving.
FINALLY
This is intended as a guide only. There are additional qualification guidelines if you do not meet the above. In addition, there are additional conditions in some circumstances. If you would like additional information or wish to discuss it further, we are as always happy to assist you.