JobKeeper: More of your questions answered

Here are a number of the many questions that Tax & Super Australia have received regarding the JobKeeper subsidy. Also see more scenarios and questions answered on this page.

Can businesses that report quarterly GST choose to assess turnover on a monthly basis?

Yes, the periods for determining the decline in turnover can be periods of one month or three months, where:

  • if a one month turnover test period is being used, it must be one of the following months:
    • March 2020
    • April 2020
    • May 2020
    • June 2020
    • July 2020
    • August 2020
    • September 2020; or​
  • if a three month period is being used it must be one of the following periods:
    • the quarter that starts on 1 April 2020;
    • the quarter that starts on 1 July 2020.

An entity’s BAS lodgement cycle is irrelevant in determining the decline in turnover. An entity can choose any one of the 9 time periods in which to make the comparison. However, the decline in turnover test must be satisfied within one of the above periods before the employer is entitled to the JobKeeper payment.

Can a business that was established in November 2019 and effectively started trading in January 2020 receive the Cash Flow Boost and/or JobKeeper assistance?

With regard to the Cash Flow Boost, the requirement to have lodged the 30 June 2019 income tax return will not have been satisfied. Also, the requirement to lodge a BAS on or before 12 March 2020, will probably not have been satisfied. Nevertheless, the Commissioner has a discretion to permit a later time for the required notification to the Commissioner. ATO information indicates that businesses in this position should contact the ATO and provide additional supporting documents to establish the business’ eligibility.

With regard to JobKeeper, where an application is being made for an “ eligible business participant”, what is said above in relation to the Cash Flow Boost will also be applicable.

Also, in relation to JobKeeper, it will be necessary for the business to satisfy the alternative test for the decline in turnover. This alternative test must be made by way of a legislative instrument issued by the Commissioner. At the time of writing, there has been no legislative instrument issued.

Can both partners in partnership apply for JobKeeper assistance?

No. While an “eligible business participant” who is involved in the daily running of the business can be nominated to receive JobKeeper assistance provided they meet the eligibility criteria, only one person can be nominated.

What is a business’s monthly reporting obligations under the JobKeeper rules?

An entity that is entitled to a JobKeeper payment must notify the Commissioner of:

  • its current GST turnover for the reporting month; and
  • its projected GST turnover for the following month

Eligible ACNC-registered charities and gift deductible recipients must also report the amount of certain donations that they have received or expect to receive.

The report must be made within 7 days of the end of the reporting month.

Additionally, there are pre- and post-payment record keeping requirements to enable the Commissioner to verify information provided.

To qualify for JobKeeper assistance is it necessary that a business has lodged a BAS or lodged an income tax return?

Yes, where the JobKeeper assistance is being sought for an “eligible business participant”. If the JobKeeper assistance is being sought for a normal employee/employer relationship, the lodgement of activity statements or tax returns is not required.

Where an entity is seeking JobKeeper assistance in relation to an “eligible business participant” , it is a requirement that:

  • An amount was included in the entity’s assessable income for the 2018-19 income year in relation to it carrying on a business; and the Commissioner had notice (e.g. a tax return) on or before 12 March 2020 (or a later time allowed by the Commissioner) that the amount should be so included,

​ OR

  • the entity made a taxable supply in a tax period that applied to it that:
    • started on or after 1 July 2018; and
    • ended before 12 March 2020; and

the commissioner had notice on or before 12 March 2020 (or a later time allowed by the Commissioner) that the entity had made the taxable supply.

How do those closely held tax entities, that have not had to register for STP yet, go about applying for JobKeeper?

The registration process is detailed on the ATO website.

If there is no work for employees and they have been stood down, but are retained on the books, are they entitled to JobKeeper assistance?

Yes. Provided the employees were employed on 1 March 2020 and meet all other requirements.

What, if any, detail has been supplied in relation to the turnover decline for service trusts/labour hire firms?

The JobKeeper scheme applies to the relationship between the employer and the employee, and the decline in turnover of that employer. Taxpayers need to examine service trusts/labour hire firm relationships to identify where the employer/employee lies.

In relation to service trusts, this is being raised as an issue where the service trust is “in-house” to the income generating entity. These arrangements are very common with professional services firms. The income generating entity (for example, a partnership) may have a significant decline in turnover.

However, due to the management fee that is paid from the partnership to the service trust, the service trust may not be experiencing a decline in turnover. This will depend on the nature of the agreement between the service trust and the income generating entity. The entities are not combined for the purposes of determining the decline in turnover.

With regard to a labour hire company, it is usually the case that the labour hire company is the employer and not the business with whom the labour hire company has a contract.

Website Comments

  1. Keith Lanstrom
    Reply

    What if the employees have been stood down but the employer has not registered the employees for Jobseeker. How do the employees register for jobseeker as the employer refuses to register the employees because there is too much [aperwork?

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