A major part of the Government’s response to the Coronavirus (or ‘COVID-19’) pandemic is the ‘JobKeeper Payment’ Scheme.
The JobKeeper Payment is a wage subsidy that will be paid through the tax system (i.e., it will be administered by the ATO) to eligible businesses impacted by COVID-19.
Under the scheme, eligible businesses will receive a payment of $1,500 per fortnight per eligible employee and/or for one eligible business participant (i.e., an eligible sole trader, partner, company director or shareholder, or trust beneficiary).
The subsidy will be paid for a maximum period of six months (i.e., from 30 March 2020 up until 27 September 2020). It will be paid to eligible businesses monthly in arrears, with the first payments to employers commencing from the first week of May 2020.
The JobKeeper Payment will ensure that eligible employees (and, where applicable, eligible business participants) receive a gross payment (i.e., before tax) of at least $1,500 per fortnight for the duration of the scheme.
A small to medium employer will only be eligible to receive a JobKeeper Payment in respect of an ‘eligible employee’ if, at the time of applying the employer estimates that their projected GST turnover has fallen (or is likely to fall) by 30% or more.
Importantly, eligible employers must actually elect to participate in the JobKeeper Scheme via an application to the ATO. In making such an application, an employer will also need to:
- Provide information to the ATO on all eligible employees (i.e., confirming the eligible employees were engaged as at 1 March 2020 and are currently employed by the business, including those who have been stood-down or re-hired). Treasury has indicated that, for most businesses, the ATO will use Single Touch Payroll (‘STP’) to pre-populate these details.
- Continue to provide information to the ATO on a monthly basis, including the number of eligible employees employed by the business and details of its turnover.
The ATO has available on its website an online form which can be used by employers to register their interest in the JobKeeper Payment Scheme.
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