Forced closures, travel restrictions, and other phenomena designed to promote social distancing have impacted Australian businesses following the outbreak of coronavirus disease 2019 (COVID-19). In an effort to promote staff retention, the Australian government has introduced the JobKeeper Payment scheme. Discover the key elements of the program, including eligibility criteria and the application process.
What is the JobKeeper Payment?
The JobKeeper Payment is a temporary governmental intervention designed to help businesses weather the effects of COVID-19. It entails biweekly wage subsidies worth A$1,500 (before tax) per eligible individual. These should help businesses retain their staff and remain viable.
Businesses with employees can claim these payments on behalf of their workers. Those without staff, such as the self-employed, are also able to access this form of assistance.
The government has set forth two key sets of eligibility criteria: those that apply to employers, and those that apply to employees. Claimants need to satisfy all of the applicable below-mentioned criteria to be eligible for the JobKeeper Payment.
Criteria for Employers:
Employers will be able to successfully claim JobKeeper Payments, provided that they:
- conducted business in Australia on March 1, 2020, or were a not-for-profit organization that conducted their primary activities in Australia, and
- employed one or more eligible employees on March 1, 2020, and
- are still currently employing the relevant individuals, including those who were previously stood down or reinstated, and
- had a turnover below A$1 billion that shrunk by over 30 percent (of at least one month), or
- had a turnover of at least A$1 billion that dropped by over 50 percent (of at least one month), or
- are registered with the Australian Charities and Not-for-profits Commission (ACNC) as an entity other than a school or university, and have lost at least 15% of their turnover, and
- are not subject to Australia's Major Bank Levy, and
- are not classified as ineligible for the JobKeeper Payment.
Based on their natural activity statement reporting period, businesses will need to prove that their turnover has been reduced in the applicable one or three months, relative to their turnover during the previous year.
In instances where businesses have been operational for less than a year, or where their earlier turnover is not indicative of their standard turnover, cases will be referred to the Tax Commissioner for consideration. The same applies to businesses that anticipate a reduction of at least 30 or 50 percent in their turnover, despite seeing a slightly lower drop than these benchmarks.
Note that businesses without employees (such as self-employed individuals), will also be eligible for the JobKeeper Payment on condition that they meet the turnover requirements.
Criteria for Employees:
Employees may receive the JobKeeper Payments from their employers, provided that they:
- were at least 18 years old on March 1, 2020 (or 16 or 17 if they are independent and not engaged in full-time studies).
- are currently working for the claimant (this includes staff members who have been stood down or rehired).
- were engaged in an employment relationship with the claimant on March 1, 2020 (either as a part-time or full-time employee or as a casual worker who had been employed regularly and systematically for a minimum of 12 months).
- are Australian citizens or holders of permanent or Special Category visas — whether protected, non-protected, or Subclass 444. Note that those who hold non-protected Special Category visas must have resided in Australia continually over the last ten or more years.
- did not receive parental leave, Dad and Partner Pay, or any workers' compensation payouts during the relevant JobKeeper fortnight(s).
- do not receive JobKeeper Payments from other employers.
- agree to be nominated for the receipt of the JobKeeper Payment.
Impact on Existing Payment Arrangements:
Owning to the JobKeeper Payment, all eligible employees will receive at least A$1,500 per fortnight before tax. This includes individuals who typically earn less than this amount, as well as workers who have been stood down.
In instances where staff members earn more than A$1,500 (pre-tax) per fortnight, the JobKeeper Payment will act as a partial subsidy, and employers will be required to pay out the difference.
Employers can choose whether to pay superannuation on additional wages that are distributed due to the JobKeeper Payment.
Accessing the JobKeeper Payment:
As of March 30, 2020, businesses can register to receive the JobKeeper Payment when they are ready to do so. Since JobKeeper Payments will be issued to employers, staff members need not apply for the subsidy. However, they should note the following:
- Those who work for multiple employers must notify their primary employers of their interest in the subsidy.
- Workers who are not Australian citizens must inform their employers of their current visa status, which will be used to determine their eligibility for the subsidy.
- Individuals who have applied for or are in receipt of income support must notify Services Australia that they are due to receive the JobKeeper Payments. This, in turn, could affect their eligibility for continued support.
Businesses without employees can also apply for the subsidy. During the process, they will be required to provide business-related information, including details about their recent turnover. The JobKeeper Payments will be made directly into successful claimants' bank accounts.
Note that employers can register for the JobKeeper Payment any time before the program ends. Employees of childcare businesses will only receive payments for the periods leading up to July 19, 2020. All other eligible employees will be compensated for the periods leading up to September 27, 2020.
Note: All businesses will be required to furnish the Australian Tax Office (ATO) with monthly updates in order to avoid the misappropriation of funds.
When will the JobKeeper Payments be made available?
Candidates could register their interest from March 30, 2020. The initial batch of payments was made during the first week of May. Note that employers are being paid monthly in arrears.
March 30, 2020
Businesses can start to register their interest in the scheme.
April 20, 2020
Businesses can start to enroll to receive JobKeeper Payments for eligible employees.
Week 1 of May 2020
First set of JobKeeper Payments is disbursed.
May 4, 2020
Businesses to ensure that they are successfully registered for the scheme in order to receive the first round of payments.
May 4–31, 2020
Businesses to identify all eligible employees in order to claim April and May subsidies.
May 8, 2020
Last day by which employers can issue payments for the periods spanning March 30 to April 12 as well as April 13 to April 26.
May 10, 2020
Last day by which employers can issue payments for the period spanning April 27 to May 10.
May 24, 2020
Last day by which employers can issue payments for the period spanning May 11 to May 24.
May 31, 2020
Final day to enroll for April and May's JobKeeper Payments.
June 1–14, 2020
Submit declaration to be reimbursed for May's JobKeeper Payments.
June 7, 2020
Last day by which employers can issue payments for the period spanning May 25 to June 7.
June 21, 2020
Last day by which employers can issue payments for the period spanning June 8 to June 21.
June 30, 2020
Final day to enroll for June's JobKeeper Payments.
July 1–14, 2020
Submit declaration to be reimbursed for June's JobKeeper Payments.
July 5, 2020
Last day by which employers can issue payments for the period spanning June 22 to July 5.
July 19, 2020
Last day by which employers can issue payments for the period spanning July 6 to July 19.
August 1–14, 2020
Submit declaration to be reimbursed for July's JobKeeper Payments.
August 2, 2020
Last day by which employers can issue payments for the period spanning July 20 to August 2.
August 16, 2020
Last day by which employers can issue payments for the period spanning August to August 16.
August 30, 2020
Last day by which employers can issue payments for the period spanning August 17 to August 30.
September 1–14, 2020
Submit declaration to be reimbursed for August's JobKeeper Payments.
September 13, 2020
Last day by which employers can issue payments for the period spanning August 31 to September 13.
September 27, 2020
Last day by which employers can issue payments for the period spanning September 14 to September 27.
October 1–14, 2020
Submit declaration to be reimbursed for September's JobKeeper Payments.
Be sure to follow the ATO to remain abreast of changes and other announcements.
How do I pay the JobKeeper Payment?
You should issue the JobKeeper Payment to your employees in the same manner that you pay their salaries unless otherwise agreed.
What are the payment dates for JobKeeper?
Employers can issue the JobKeeper Payment to their employees as soon as they receive the funds. However, they should observe all applicable deadlines which tend to vary depending on the fortnight under consideration.
Can you pay JobKeeper monthly?
Yes. Note that staff members should receive the equivalent of A$1,500 per fortnight.
Is the JobKeeper Payment taxable?
Yes. The JobKeeper Payment is treated as "regular" income, and employers are expected to withhold income tax on behalf of their employees, as usual.
Is the JobKeeper payment issued weekly?
No. Instead, the ATO will issue payments to employers on a monthly basis (in arrears). Employers, in turn, should ensure that they pay their staff the equivalent of A$1,500 each fortnight.
Do I have to work to get the JobKeeper payment?
Not necessarily. Individuals who have been stood down will be eligible for the JobKeeper Payment if they satisfy the applicable criteria. The same applies to casual workers who were employed by the specific company regularly and systematically in the twelve months preceding March 1, 2020.
Is the JobKeeper Payment back paid?
Yes. The ATO pays employers monthly in arrears. Employers, in turn, are required to pay their staff for the preceding fortnight or month, depending on the applicable payment arrangements.
Is super payable on the JobKeeper Payment?
Employers will be subject to the same superannuation arrangements as before in cases where their employees earn more than A$1,500 per fortnight. Where employees have their wages increased to A$1,500 per fortnight as a result of the JobKeeper Payment, employers get to decide whether they would like to pay superannuation on the additional amount.
Who is eligible for the JobKeeper Payment?
There are numerous criteria for employers/businesses and employees alike. Most saliently, businesses ought to have witnessed a considerable decrease in their turnover as a result of COVID-19. Moreover, they must not be subject to Australia's Major Bank Levy. Employees, in turn, must be at least 16 years old, engaged in some form of employment relationship with their employer, and be Australian citizens or possessors of permanent or Special Category visas.
Can I get the JobKeeper Payment and still work?
Yes. The primary goal of the subsidy is to help businesses retain their staff. Note, however, that you cannot receive the JobKeeper Payment from more than one employer at any given time.
Can I get the JobKeeper Payment as a sole trader?
Yes, provided that your GST turnover has fallen by at least 30%; that you had an Australian Business Number (ABN) on or prior to March 12, 2020; are actively engaged in your business; are not eligible to receive the JobKeeper Payment from another source; do not serve as a permanent employee for anyone else; were at least 16 years olf on March 1, 2020; and were either an Australian citizen or in possession of a permanent or Special Category visa on March 1, 2020.
Can you get JobKeeper if you have a second job?
Yes. Note, however, that you cannot receive the JobKeeper Payment from more than one source at a time. Instead, it should only be issued to you by your primary employer.
When should I expect my JobKeeper Payment?
The ATO has stipulated a number of deadlines by which employers should issue the JobKeeper Payment to their staff. Be sure to check in with your employer if you have not received payment by these dates. Cases of suspected fraud should be reported to the confidential tip-off hotline, which can be reached by calling 1800 060 062. Alternatively, individuals can complete the tip-off form online or in the "Contact Us" section of their ATO mobile app.
How often is JobKeeper paid to sole traders?
Like employers, sole traders receive the JobKeeper Payment monthly in arrears.
Is it too late to apply for the JobKeeper Payment?
No. Interested individuals can apply any time before the scheme ends. You should note that employees of childcare businesses will only be paid for the periods leading up to July 19, 2020, while other eligible individuals will be paid for the periods leading up to September 27, 2020.
Can you get JobSeeker and JobKeeper Payments?
Possibly. The JobKeeper Payment is regarded in the same way as "regular" income and must be declared as such to Services Australia. This might render some ineligible for the JobSeeker Payment.
Does the JobKeeper Payment affect the Family Tax Benefit?
The JobKeeper Payment is regarded as remuneration and should thus be included in your income estimate for Services Australia to determine the size of your Family Tax Benefit (if applicable).
Will the JobKeeper Payment affect my Disability Support Pension?
Yes, the wage subsidy will affect your Disability Support Pension (DSP). Your DSP may be smaller or stop for the time being, but you will likely receive more money per fortnight when you account for your JobSeeker Payment. Be sure to let Services Australia know that you are receiving the JobSeeker Payment so that they can adjust your benefit(s) accordingly. You should also inform them once you stop receiving the JobKeeper Payment.
Does the JobKeeper Payment affect Centrelink payments?
Many people cannot receive the JobKeeper Payment in conjunction with income support. Be sure to declare all of your income — including the JobSeeker Payment — to Services Australia when appropriate. The entity will either lower your Centrelink payment amount or cease payments altogether if you exceed the relevant threshold.
How do I claim my JobKeeper Payment?
Employers will claim the JobKeeper Payment on behalf of their employees. Those without employees — including sole traders — should apply for the subsidy online.
Is the JobKeeper Payment tax-free?
No. The JobKeeper Payment is regarded as "regular" income, and employers are expected to withhold income tax on behalf of their staff, as usual.
How much tax do I pay on the JobKeeper Payment?
You should be taxed at the marginal rate for each payment. For the most part, this reportedly equates to A$192.00 per fortnight if you claim the tax-free threshold, or A$434.00 per fortnight if you do not.
How long will JobKeeper Payments last?
The ATO disbursed the first set of subsidies in early May of this year. This was said to cover the periods spanning March 30 to April 12, as well as April 13 to April 26. Employees of childcare businesses will receive payments for the periods leading up to July 19, 2020. All other eligible individuals will be compensated for the periods leading up to September 27, 2020.
Can I get the JobKeeper Payment if I have another job?
Yes. However, you cannot receive the JobKeeper Payment from both of your employers. You will have to identify your primary employer and ensure that they claim the subsidy on your behalf.
How do sole traders apply for the JobKeeper Payment?
Sole traders can either log in to myGov and then select the ATO, or log in to the Business Portal. Thereafter, you should select "Enrol business for JobKeeper wage subsidies" and follow the prompts on the screen. Be sure to view the ATO's detailed guide if you get stuck along the way.
What is the JobKeeper Payment?
The JobKeeper Payment is a temporary scheme that has been instituted by the Australian government. It is intended to support businesses with and without employees in instances where the business's turnover has been significantly reduced following the outbreak of the coronavirus (COVID-19). Affected individuals will receive at least A$1,500 (pre-tax) every fortnight.
What happens if my employees earn more than A$1,500 per fortnight?
Employees who earn more than A$1,500 (pre-tax) per fortnight will be entitled to their usual pay. In other words, the JobKeeper Payment will serve as a partial wage subsidy, and employers will be required to pay the difference.
What happens if my employees earn less than A$1,500 per fortnight?
In that case, employees will be entitled to the full JobKeeper Payment of A$1,500 (pre-tax) per fortnight.
Are stood down workers eligible for the JobKeeper Payment?
Yes, provided that they were employed by the business on 1 March 2020 and that they meet the other eligibility criteria.
Do recipients of the JobKeeper Payments need to notify Services Australia?
Yes. This could affect eligibility for other support from Services Australia, such as the JobSeeker Payment and Coronavirus Supplement.