On the 7th August 2020, the Government announced adjustments to JobKeeper 2.0, (only announced on 21st July 2020), to expand the eligibility for the scheme from 28 September 2020. This was mainly brought about by the lockdown recently imposed in Victoria affecting businesses that may have improved in the June quarter, however would experience a deterioration in the September quarter. Under the 21st July JobKeeper 2.0 announcement, they would not be eligible for the scheme after 27 September 2020.
The 6-month extension to the original JobKeeeper scheme until 28 March 2021 would be less generous and 2 separate extension periods would apply (from 28 September 2020 to 3 January 2021, and from 4 January 2021 to 28 March 2021). Lower JobKeeper fortnightly payments, as well as a new Decline in turnover test would apply for these periods.
The adjustments to JobKeeper 2.0, as announced on 7th August, with apply nationwide and include the following:
Employee Eligibility – from 3 August 2020, those employees that were hired as of 1 July 2020 will be eligible for JobKeeper. Previously this was a 1 March 2020 date, meaning from 3 August, more employees will be eligible for the original JobKeeper as well as for the extension periods.
Note: casual employees will still be required to have been employed on a ‘regular and systematic’ basis for at least 12-months.
Decline in Turnover Test –
- for Extension Period 1 (28 September 2020 to 3 January 2021), businesses will need to demonstrate the required reduction in actual GST turnover for the September 2020 quarter only (compared to the corresponding period in 2019). Note - under JobKeeper 2.0 a decline in both the June 2020 quarter and September 2020 quarter was required.
- for Extension Period 2 (4 January 2021 to 28 March 2021), businesses will need to demonstrate the required reduction in actual GST turnover for the December 2020 quarter only (compared to the corresponding period in 2019). Note – under JobKeeper 2.0, a decline in turnover was required in each of the June, September and December 2020 quarters to be eligible for this extension period.
Drop in payment amounts to remain the same
As announced on 21st July, the reduction in the payment amounts will proceed under JobKeeper 3.0.
- the full rate of $1,500 per fortnight will reduce to $1,200 per fortnight from 28 September 2020 to 3 January 2021. Then a further reduction to $1,000 per fortnight from 4 January 2021 to 28 March 2021. These rates apply to employees and business participants working at least 20 hours per week on average in the relevant period.
- For those working less than 20 hours per week on average in the relevant period, the rate is $750 per fortnight from 28 September to 3 January 2021, then $650 per fortnight from 4 January 2021 to 28 March 2021.
The proposed adjustments are at this stage just announcements, as they have not as yet been legislated. We also await further guidance from the Australian Taxation Office as to Alternative tests in relation to the requisite decline in turnover – for example, where the business was not in existence in the September or December 2019 quarters.
If you would like to know more about how these adjustments to JobKeeper impact you or your business, please get in touch with us.