Coronavirus Stimulus Package – JobKeeper payments

A $130 billion helping hand for businesses and their employees.

COVID-19 Government Economic Response Phase III

The third economic response to COVID-19 was delivered by the Australian Government on 30 March 2020, worth $130 billion. This is in addition to the first response on 12 March 2020 and the second response on 22 March 2020. (See YBM’s Coronavirus Stimulus Package blogs for details on other parts of the stimulus packages )

JOBKEEPER PAYMENT

Employers will receive a $1500 per fortnight before tax payment for each employee they keep on for the next six months. Payments will be calculated from 30 March 2020 and paid monthly in arrears to the employer. First payments are expected in the first week of May. The Australian Government estimates that this measure will benefit around 6 million Australian workers.

Who is eligible?

• Those businesses with turnover of less than $1 billion and their turnover will be reduced by more than 30% compared to a period (of at least a month) at the same time last year; or
• Those businesses with turnover of $1 billion or more and their turnover will be reduced by more than 50% compared to a period (of at least a month) at the same time last year; and
• The business is not subject to the Major Bank Levy.

Not-for-profit entities and self employed individuals that meet the turnover tests are eligible to apply.

The employees who are eligible are:

• Currently employed by the employer, even if they have been stood down or re-hired since the 1 March 2020;
• Those who were employed by the employer at 1 March 2020;
• Employed on a full-time, part-time basis;
• Employed on a casual basis and have been on a regular basis for longer than 12 months as at 1 March 2020;
• At least 16 years old;
• An Australian citizen, hold a permanent visa, a protected category visa holder, a non-protected Special Category Visa Holder who has resided continually in Australia for 10 years or more, or workers from New Zealand on a Special Category (Subclass 444) Visa Holder; and
• Not in receipt of a JobKeeper payment from another employer. The employee should receive the JobKeeper payment from the employer with which they claim the tax free threshold.

How is it accessed?

The employer must also assess that they have or will experience the required decline in turnover.

This includes businesses without employees, such as sole traders and partners. These businesses will have to nominate an individual to receive the payment.

Employer Obligations

Employers will need to provide the information on the employees to the ATO although for those reporting through Single Touch Payroll the ATO will use these details for the employees. This information will have to be provided monthly.

Employers will need to pay each employee, including stood down employees, the $1500 before tax per fortnight even if they would have normally received less than this amount. It is up to the employer if they would like to pay superannuation on the additional amount. If the employee’s regular wage was more than the $1500, the employer can pay the difference.

Employers will need to tell the employees that they are receiving a JobKeeper payment as it can only be claimed by one employer. An employee will still be eligible if they continue to earn a wage from their second job. It will also affect a JobSeeker payment if the employee has applied due to reduced hours or being stood down. It is the employees responsibility to advise Services Australia of the JobKeeper payment.

Please contact YBM for assistance with the COVID-19 Economic Stimulus packages and determining your eligibility for the measures announced.

By Karen Bollinger – YBM

Yates Baker McLean. Accountants and Business Advisors situated in the Central West of NSW. Offering comprehensive advice for all your financial needs including tax, auditing, business advisory, self managed super funds, specialised industry experience and financial planning.