You may have heard or is already currently accessing the JobKeeper payment scheme by the Australian Government to support employees and businesses affected by the Coronavirus. This is where the Government provides $1,500 per fortnight (before tax) until the 27th September for eligible employees.
Employers will be eligible for the subsidy, if at the time of applying:
- They face a 30% fall in turnover (for an aggregated turnover of $1 billion or less)
- They face a 50% fall in turnover (for an aggregated turnover of more than $1 billion), or
- Their business is not subject to the Major Bank Levy
What does this mean for employers?
Their business will be faced with various reporting obligations to ATO, including monthly declarations to claim JobKeeper payments for the previous month that includes information on current and projected GST turnover, and any changes to its eligible employees.
There are also two key conditions to consider when applying:
- There is a ‘wage condition’ attached to JobKeeper payments, where eligible employers must pay all of their eligible employees at least the minimum amount of $1,500 per fortnight even if they normally earn less than this per fortnight.
- Possibility of payback is unclear. If the business predicts its turnover incorrectly, such as if company sales turn out better than expected, it is uncertain whether the company would have to repay the subsidy. The government states that “there will be some tolerance where employers, estimate a 30 per cent or more or 50 per cent or more fall in turnover but actually experience a slightly smaller fall.” However, this “tolerance” has not been clearly defined.
If your business is struggling financially or if you are considering (or have) applied for Jobkeeper and would like to learn more, please talk to Insolvency Services Australia for free and confidential advice on our 24/7 toll-free hotline on 1800 003 883.