In March 2020, the Australian government announced the $1,500 JobKeeper subsidy to keep as many Australian businesses, and their employees, working during the COVID-19 Pandemic.

To take advantage of this new subsidy, your business must meet the eligibility criteria. Separately, the employee that you are claiming for will need to meet their own set of criteria which you can read more about here.

Eligibility for Employers

  • On 1 March 2020, you carried on a business in Australia or were a not-for-profit organisation that pursued your objectives principally in Australia.
  • You employed at least one eligible employee on 1 March 2020.
  • Your eligible employees are currently employed by your business for the fortnights you claim for (including those who are stood down or re-hired).
  • Your business has faced a
    • 30% fall in turnover (for an aggregated turnover of $1 billion or less)
    • 50% fall in turnover (for an aggregated turnover of more than $1 billion), or
    • 5% fall in turnover (for ACNC-registered charities other than universities and schools).
  • Your business is not in one of the ineligible categories.

There is also a list of exclusions for businesses who cannot apply for this subsidy. For example, you are not eligible to apply if you are a local governing body or agency, in liquidation or entered bankruptcy. Read the full list here.

How to calculate aggregated turnover

Your aggregated turnover broadly includes your annual turnover, plus the annual turnover of all entities that are connected or affiliated with you, subject to specific adjustments (for example, for transactions between you and those other entities).

How to assess your fall in turnover?

To appropriately assess your turnover decline the ATO has now outlined under two tests;

  1. Basic
  2. Alternative

We have summarised these below, plus more details can be found on the ATO website here.

Basic Test

  1. Compare GST turnover for the month of March 2020 with GST turnover for the month of March 2019;
  2. Compare projected GST turnover for the month of April 2020 with projected GST turnover for the month of April 2019;
  3. Compare projected GST turnover for the quarter starting April 2020 with projected GST turnover for the quarter starting April 2019.

If your business does not pass the test based on one of the above, then you can still qualify in a future month and receive the payment from the start of that future month. The future test periods are:

  1. May 2020 compared to May 2019;
  2. June 2020 compared to June 2019;
  3. July 2020 compared to July 2019;
  4. August 2020 compared to August 2019;
  5. September 2020 compared to September 2019;
  6. July to September 2020 quarter compared to July to September 2019 quarter.

You can use any of the above test periods regardless of whether you lodge a monthly or quarterly BAS. If you calculate a larger than 30% reduction based on one of the above periods, then the business is eligible for the JobKeeper payment from the start of that period up to 30 September 2020, even if your future turnover increases.

The Alternative Test

The ATO has the discretion to determine an alternative test for fall in turnover for entities where there is not an appropriate relevant comparison period and, therefore, cannot use the basic test.

The ATO will use this alternative test where there is something out of the ordinary about the relevant comparison period in 2019, meaning it is not appropriate for the purpose of an entity satisfying the basic test.
Some examples are:

  1. An entity recently commenced a new business;
  2. An entity acquired a business after the relevant comparison period;
  3. An entity was scaling up their business after the relevant comparison period;
  4. An entity’s turnover is highly variable;
  5. A farming business was subject to a severe drought from 2018 until September 2019 that reduced the amount of its’ crop that it could grow;
  6. An entity has had major structural business changes after the relevant comparison period.

The ATO will provide more advice on how to manage and or calculate this shortly.

How to apply

You will be able to enrol in the JobKeeper scheme from 20 April 2020 using an online form on the ATO’s website. After you enrol, you will later identify your specific eligible employees and submit the information to the ATO. If you have registered with the ATO for an update on the JobKeeper Payment, you will soon receive a notification from the ATO when the online enrolment is available.

If you need assistance

Once you have checked your employees are eligible, we can help you register for JobKeeper with the ATO for $250 ex GST for up to 2 employees with additional employee’s charged at $25 ex GST per employee. As always, if you would like specific Employer guidance for your business during this time, get in touch with Dexterous Group here, drop us an email or call +61 2 9167 8880.