JobKeeper 2.0 has begun – new rates and eligibility tests apply

by | Oct 6, 2020 | Accounting & Bookkeeping, For Business, For Individuals, Tax

The final fortnight of JobKeeper 1.0 closed on Sunday 27 September and the next phase, dubbed JobKeeper 2.0, has begun. The Treasurer has announced two extensions to the JobKeeper program (which may mean your business is eligible to keep receiving payments until March 2021). The latest iteration of the rules (unlikely to be final if the original JobKeeper is anything to judge from) was just issued recently, with the Australian Taxation Office issuing the alternative tests on Wednesday 23 September 2020.

We would like to continue supporting businesses during this period and have allocated two senior staff as technical specialists, as well as many accountants, to help with the claims. We will be sending out new engagement letters for the extension program as clients will need to review their eligibility.

With the two extensions to JobKeeper, there comes reduced and two tiered payment rates, and new eligibility tests.

Payment Rates

From 28 September 2020 to 3 January 2021, the JobKeeper Payment rates will be:

  • $1,200 per fortnight for all eligible employees who were working (or for business participants actively engaged) in the business for 20 hours or more a week on average in the four weeks of pay periods before either 1 March 2020 or 1 July 2020, and
  • $750 per fortnight for all other eligible employees and business participants.

From 4 January 2021 to 28 March 2021, the JobKeeper Payment rates will be:

  • $1,000 per fortnight for all eligible employees who were working (or for business participants actively engaged)  in the business for 20 hours or more a week on average in the four weeks of pay periods before either 1 March 2020 or 1 July 2020, and
  • $650 per fortnight for all other eligible employees and business participants.

Businesses will be required to nominate which payment rate they are claiming for each of their eligible employees (or business participants).

Decline in Turnover Tests

In order to be eligible for the JobKeeper Payment from 28 September 2020, businesses will have to meet a new decline in turnover test for each of the two periods of extension, as well as meeting the other existing eligibility requirements for the JobKeeper Payment.

In order to be eligible for the first JobKeeper Payment extension period of 28 September 2020 to 3 January 2021, businesses will need to demonstrate that their actual GST turnover has fallen in the September quarter 2020 (July, August, September) compared to 2019.  If this is not met, they may still be able to satisfy one of the alternative tests.

In order to be eligible for the second JobKeeper Payment extension period of 4 January 2021 to 28 March 2021, businesses will need to demonstrate that their actual GST turnover has fallen in the December quarter 2020 (October, November, December) relative to a comparable period (generally the corresponding quarter in 2019). Again, there may be access through the alternative tests.

At this stage the turnover tests are less flexible; with the method of determining turnover (i.e. cash or accrual) to be the same as your GST lodgement methodology.

Webinar on JobKeeper 2.0

In addition to contacting our clients directly, we also held a webinar on Tuesday about this topic. If you missed it, click on the button below to catch up or to watch any of our other previous webinars, which are all recorded and made available on our website.