September is fast approaching and much of the initial government assistance is coming to an end. On top of this, we are witnessing a second wave in many parts of the world, including Victoria and New Zealand, as well as the States and Europe, plus continuing escalation in Asia and South America. To date, New South Wales and Queensland have been quite fortunate to minimise community transmission, however, we remain vigilant to the risks. As business evolves there will be some ongoing support from government and one of the most critical items is the extension to the JobKeeper Programme. The basic elements of the continued support are as follows:
On 21 July, the Government announced it is extending the JobKeeper Payment until 28 March 2021 and is targeting support to those businesses and not-for-profits which continue to be significantly impacted by the Coronavirus.
From 28 September 2020, eligibility for the JobKeeper Payment will be based on actual turnover in the relevant periods, the payment will be stepped down and paid at two rates.
From 28 September 2020, businesses seeking to claim JobKeeper Payment will be required to re-assess their eligibility for the JobKeeper extension with reference to their actual turnover in the September quarter 2020 (compared to the September quarter 2019). Businesses and not-for-profits will need to demonstrate that they have met the relevant decline in turnover test in this quarter to be eligible for JobKeeper from 28 September 2020 to 3 January 2021.
Businesses and not-for-profits will need to further reassess their eligibility in January 2021 for the period from 4 January to 28 March 2021. Businesses and not-for-profits will need to demonstrate that they have met the relevant decline in turnover test in the December quarter 2020 (compared to the same period in 2019) to remain eligible for the March quarter 2021.
The reference date for assessing which employees are eligible for the JobKeeper Payment is now 1 July 2020 with effect from 3 August 2020. This includes the current Jobkeeper Scheme, therefore current employees who weren’t employed in March 2020 should now be eligible under the current and extended JobKeeper Programme. The reference period for employees regarding their hours worked to determine their tier of payment will be the two fortnightly pay periods prior to 1 March 2020 or 1 July 2020. The period with the higher number of hours is to be used for employees who were eligible at 1 March 2020.
New JobKeeper Payment Rates
The JobKeeper Payment rate is to be reduced for each of the two extended quarters and paid at two rates:
- From 28 September 2020 to 3 January 2021, the payment rate will be $1,200 per fortnight for all eligible employees who, in the four weekly pay periods before the reference period, were working in the business for 20 hours or more a week on average, and $750 per fortnight for employees who were working less than 20 hours a week.
- From 4 January 2021 to 28 March 2021, the payment rate will be $1,000per fortnight for all eligible employees who, in the four weekly pay periods before the reference period, were working in the business for 20 hours or more a week on average, and $650 per fortnight for employees who were working less than 20 hours a week.
These are important changes for your business. Please talk to your account for advice on how best to obtain this assistance from the Australian Government. There are many other rules and regulations surrounding this change and the above information is a brief overview only and not to be considered advice. Please seek independent advice from your tax, business and financial advisors.