COVID-19 Update - JobKeeper payment announced
This week the Government has announced further measures as part of their response to businesses and individuals impacted by COVID-19. In an effort to keep more Australian's in job's and support businesses who may not be able to afford to keep all their employees, the government will inject $130billion into a JobKeeper payment.
What does this mean if you are an employer?
From the 30th March, if your business has been significantly impacted by the Coronavirus you will be entitled to a wage subsidy equivalent to $1,500 per fortnight so that you can keep paying your employees. The subsidy will be available for a maximum of 6 months.
You will be eligible for the subsidy if:
your business has a turnover of less than $1 billion and your turnover has fallen by more than 30 per cent (of at least a month); or
your business has a turnover of $1 billion or more and your turnover has fallen by more than 50 per cent (of at least a month); and
your business is not subject to the Major Bank Levy.
You need to be in an employment relationship with eligible employees as at 1 March 2020 and those employees need to be currently engaged in order to receive the JobKeeper payment.
Not-for-profit entities (including charities) and self-employed individuals (businesses without employees) that meet the turnover tests that apply for businesses are eligible to apply for JobKeeper Payments.
Eligible employees are employees who:
are currently employed by the eligible employer (including those stood down or re-hired);
were employed by the employer at 1 March 2020;
are full-time, part-time, or long-term casuals (a casual employed on a regular basis for longer than 12 months as at 1 March 2020);
are at least 16 years of age;
are an Australian citizen, the holder of a permanent visa, a Protected Special Category Visa Holder, a non-protected Special Category Visa Holder who has been residing continually in Australia for 10 years or more, or a Special Category (Subclass 444) Visa Holder; and
are not in receipt of a JobKeeper Payment from another employer. If your employees receive the JobKeeper Payment, this may affect their eligibility for payments from Services Australia as they must report their JobKeeper Payment as income.
What does this mean if you are an employee?
If you qualify as an eligible employee, your employer will notify you that you will be receiving the JobKeeper payment. The majority of employees will not need to do anything further.
If you receive confirmation that you are eligible, you will start receiving fortnightly payments of $1,500 before tax. It is at your employers discretion as to whether they pay anything in addition to this payment or if they pay superannuation.
Full time and part time employees, including stood down employees, would be eligible for the JobKeeper Payment. If you are a casual employee and have been with your employer for at least the previous 12 months you will also be eligible for the Payment.
There are a number of ways in which you can receive the payment. They are:
If you usually receive $1,500 or more in income per fortnight before tax, you will continue to receive your regular income. The JobKeeper Payments will subsidise part or all of your income.
If you usually receive less than $1,500 in income per fortnight before tax, your employer must pay you, at a minimum, $1,500 per fortnight, before tax.
If you have been stood down, your employer must pay you, at a minimum, $1,500 per fortnight, before tax.
If you were employed on 1 March 2020, subsequently ceased employment and then were re-engaged by the same eligible employer, you will receive, at a minimum, $1,500 per fortnight, before tax
How to register for the JobKeeper payment
Initially, employers can register their interest in applying for the JobKeeper Payment via ato.gov.au.
Subsequently, eligible employers will be able to apply for the scheme by means of an online application.
The ATO will start making payments to eligible employers in the first week of May.
In order to receive the payments, eligible employers will need to identify eligible employees and will need to provide monthly updates to the ATO. Participating employers will be required to ensure eligible employees will receive, at a minimum, $1,500 per fortnight, before tax.
The above measures are still being legislated and may be subject to changes. Please contact Murray Accounting & Tax so that we can help you through the process.