Legislation to extend Jobkeeper has passed both houses and received royal assent. Further, yesterday afternoon the Treasurer released a legislative instrument providing further details.
The instrument sets out the decline in turnover test for the extension of JobKeeper to 28 March 2021, and the new two-tiered payment rates.
It also contains provisions that address the situation for employees of businesses that have changed hands.
Special provision is also made in the legislative instrument for JobKeeper payments to business participants and religious practitioners.
Following are examples from the legislative instrument pertaining to employers who have already qualified for the original JobKeeper scheme, and employers who will qualify for the first time under the JobKeeper extension:
Example - Requalifying for the JobKeeper scheme during the extension period
Tom Enterprises had been receiving JobKeeper payments since the commencement of the JobKeeper scheme in respect of six of its employees, from the JobKeeper fortnight beginning 30 March 2020. However, Tom Enterprises did not remain a qualifying entity for the JobKeeper extension for JobKeeper fortnights beginning on and after 28 September 2020 because it did not meet the actual decline in turnover requirements for the quarter ending 30 September 2020 by the required percentage.
Tom Enterprises assesses in early January 2021 that it had a 45 per cent decline in turnover for the quarter ended 31 December 2020 compared to the relevant comparison period (which is the corresponding quarter in 2019) and therefore satisfies the actual decline in turnover test for JobKeeper fortnights beginning on and after 4 January 2021. As Tom Enterprises has previously participated in the JobKeeper scheme, it does not need to specifically retest its qualification based on the original decline in turnover test (Tom Enterprises would have met this requirement previously).
Having previously qualified, Tom Enterprises does not need to notify the Commissioner that it elects to participate in the JobKeeper scheme again. However, Tom Enterprises must meet all other qualifying requirements, including the wage condition, and the new notification requirements to the Commissioner and employees regarding the rate of JobKeeper payment that applies to Tom Enterprises in respect of each the employees.
Example - An entity that starts to participate in the JobKeeper scheme for JobKeeper fortnights beginning on or after 28 September 2020
TWC Inc. did not participate in the JobKeeper scheme for JobKeeper fortnights between 30 March 2020 and 27 September 2020. This is because TWC Inc. did not expect to have a substantial decline in turnover during the original duration of the scheme and as such did not elect to participate in the scheme.
However, TWC Inc. experienced a decline in its turnover over August and September 2020 at a higher rate than it expected. On 25 September 2020, TWC Inc. realised that this decline was large enough for it to participate in the JobKeeper scheme extension. For JobKeeper fortnights beginning on or after 28 September 2020, TWC Inc. determines that it has met:
the original decline in turnover test – TWC Inc.’s decline in projected GST turnover for the quarter ending on 30 September 2020, is greater than the required 30%; and
the new actual decline in turnover test – TWC Inc. experienced an actual decline in turnover for the quarter ending on 30 September 2020 that was greater than the required 30% rate
Subject to meeting all other qualifying requirements (including notification and election requirements) and eligibility conditions for its employees, TWC Inc. qualifies for the JobKeeper payment for the JobKeeper fortnights beginning on and after 28 September 2020.
However, TWC Inc. cannot qualify for JobKeeper payments for JobKeeper fortnights between 30 March 2020 and 27 September 2020 because it had not previously elected to participate in the scheme.
For JobKeeper fortnights beginning on or after 4 January 2021, TWC Inc. will need to test its actual decline in turnover with reference to the quarter ending 31 December 2020 to determine if it continues to qualify for JobKeeper payments.
Additional guidance from the ATO is expected very soon, around the Commissioner’s discretionary powers, including to:
determine a higher rate of JobKeeper payment
determine alternative reference periods
attribute certain supplies or classes of supplies as having been made at a particular time
specify an alternative decline in turnover test and
specify a modified test for certain group structures.
Source : Australian Bookkeepers Network