JobKeeper 2.0 – The New Requirements
We previously provided you with details of the eligibility criteria to continue to receive JobKeeper, past the initial JobKeeper end date of 27 September 2020. Last week, the Federal Government announced an easing of the eligibility criteria and further details have been provided in relation to eligible employees and assessing which rate applies to your eligible employees.
Revised Eligibility Tests
The broad eligibility tests to access JobKeeper remain the same with an extended decline in turnover test. To receive JobKeeper payments from 28 September 2020, businesses will need to meet the basic eligibility tests and an extended decline in turnover of greater than 30% based on actual GST turnover. Eligibility will be tested as follows:
From 28 September 2020, businesses with aggregated turnover less than $1 billion will be required to show an actual decline in turnover of at least 30% for the September 2020 quarter relative to the same period in 2019 to qualify for JobKeeper payments covering the extended period to 3 January 2021.
From 4 January 2021, businesses with aggregated turnover of less than $1 billion must reassess their turnover to demonstrate that they have met an actual decline in turnover of at least 30% for the December 2020 quarter relative to the same period in 2019. If met, the business will qualify to receive JobKeeper payments covering the period 4 January 2021 to 28 March 2021.
*Note: Businesses must have qualified for the initial JobKeeper payment scheme ending on 27 September 2020 (JobKeeper 1.0), at least in part, to qualify for JobKeeper 2.0. Businesses can still qualify for JobKeeper 1.0 , even if they didn’t qualify initially, so long as turnover is down by at least 30% in any month in the September 2020 quarter. Please contact our office if you think your business may be able to qualify for JobKeeper 1.0 during the September 2020 quarter.
The Government has announced that employee eligibility tests will change from 3 August 2020 onwards. The proposed changes mean that employees who were previously ineligible for JobKeeper because they were not employed by the business on 1 March 2020, may now be able to receive JobKeeper payments if they were employed by the business on 1 July 2020 and can fulfil all of the other eligibility requirements, as follows:
- On 1 July 2020 (previously 1 March 2020):
- Was aged 16 years and over; and
- If the individual was aged 16 or 17, was either financially independent or was not undertaking full-time study;
- Was an employee other than a casual, or was a long-term casual (employed by the business on a regular and systematic basis during the period of 12 months ended 1 July 2020; and
- Was an Australian resident (under the meaning of the ), or a resident for tax purposes and held a Subclass 444 (Special category) visa.
- And, at any point during the JobKeeper fortnight:
- Was an employee of the employer (including employees that have been stood down or rehired); and
- Was not an excluded employee:
- An employee receiving parental leave pay or dad and partner pay; or
- An employee receiving workers compensation payments in relation to total incapacity.
- And, has provided the JobKeeper Payment Employee Nomination to the employer:
- Agreeing to be nominated by the employer as an eligible employee under the JobKeeper scheme; and
- Confirming that they have not agreed to be nominated by another employer; and
- If they are a long-term casual, they do not have permanent employment with another employer.
From 28 September 2020 the payment rates for JobKeeper will reduce and split into a higher and lower rate.
Whether an eligible employee can access the higher or lower rate will depend on the number of hours they worked during a 4 week test period. The Government indicates that the higher rate will apply to employees who worked at least 20 hours a week on average in the four weeks of pay periods prior to either 1 March 2020 or 1 July 2020.
- From 28 September 2020:
- For employees working greater than 20 hours per week during the 4 week test period, the JobKeeper rate will reduce to $1,200 per fortnight;
- For employees working less than 20 hours per week during the 4 week test period, the JobKeeper rate will reduce to $750 per fortnight.
- From 4 January 2021:
- For employees working greater than 20 hours per week during the 4 week test period, the JobKeeper rate will reduce to $1,000 per fortnight;
- For employees working less than 20 hours per week during the 4 week test period, the JobKeeper rate will reduce to $650 per fortnight.
JobKeeper payments from 28 September 2020 are paid at a lower rate for employees who worked less than 20 hours per week on average in the four weeks of pay periods before 1 March 2020 and the four weeks of pay periods before 1 July 2020.
The Commissioner of Taxation will have discretion to set out alternative tests for those situations where an employee’s or business participant’s hours were not usual during February or June 2020. Also, the ATO will provide guidance on how this will be dealt with when pay periods are not weekly. This guidance is not as yet available. We will provide these details in due course.