JobKeeper 2.0 Extension of JobKeeper

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Jobkeeper 2.0 legislation has been passed extending the historic assistance package by a further 6 months to 28 March 2021. It replaces the $1,500 a fortnight which finishes on 27 September 2020.

There is now new eligibility tests and a reduced two-tier (Tier 1 and Tier 2) payment rate from 28 September 2020.

Here’s what you need to know

1. The 2 new extensions of jobkeeper are for pay periods:

  • 28 September 2020 to 3 January 2021 (Extension 1)
  • 4 January 2021 to 28 March 2021 (Extension 2) 

2. There are 2 tests to pass to receive JobKeeper extensions

  • Turnover Test
  • Employee eligibility test (which includes business particpants) 

3. Turnover test

As with the 1st stage of JobKeeper (1 March 2020 to 27 September 2020) an employer must be carrying on a business and their turnover must fall by 30% or more for aggregated turnovers of $1b or less.

Employers will now need to reassess their turnover for each of the 2 new periods ie

  • The first extension (for payments between 28 September 2020 to 3 January 2021) you will need to assess your actual gst turnover for the September 2020 quarter and compare it to the same quarter in the previous year. 
  • For the 2nd extension (for payments between 4 January 2021 to 28 March 2021) employers will then need to assess their turnover again for the December quarter 2020 and compare to the previous year’s quarter. 

You must use a quarterly comparison not monthly. The commissioner of taxation will have a discretion to set out alternative tests where the previous quarter is not appropriate or available.

4. Employee Eligibility Test

The new test date for assessing employees is 1 July 2020 (originally 3 March 2020) ie:
employees must be fulltime part-time or long term casual employees employed as at 1 July 2020.
 
This is applicable from the 10th Job keeper fortnight ie 3 August 2020 pays onwards.
 

5. Once eligible you have to calculate the correct JobKeeper rates for each employee:

The new rates will be split into a high and low rate (based on average weekly work hours) in the 4 weeks prior to the applicable employment date either 1 March 2020 or 1 July 2020. The threshold is 20 hours.
 

JobKeeper30 March to 27 September 2020Extension period 1 
28 September to 3 January 2021		Extension period 2
4 January 2021 to 28 March 2021


Payment


$1,500 per fortnight per employee		$1,200 per fortnight per employee or business participant who worked > 20 hours per week


$750 per fortnight per employee or business participant working < 20 hours per week  		$1,000 per fortnight per employee or business participant who worked > 20 hours per week
  $650 per fortnight per employee or business participant working < 20 hours per week

6. Eligible Business Participants (EBP)  

If you are an EBP ie a soletrader, shareholder or director of a company, a partner or beneficiary of a trust you are eligible for the above as long as you pass the turnover tests and you were actively engaged in your business for more than 20 hours a week.
 
What you need to do:
 
From 28 September 2020 please do the following:

  1. Check turnover
  2. Check employees
  3. Work out if Tier 1 or Tier 2 rate applies
  4. Ask new eligible employees to complete a JobKeeper declaration
  5. Notify the Commissioner via the portal of your eligible employees and which payment rate applies to them
  6. During JobKeeper extension 1 pay your eligible employees at least
  • $1,200 per fortnight for Tier 1 employees
  • $720 per fortnight for Tier 2 employees

       7. During JobKeeper extension 2 pay your employees at least:

  • $1,000 per fortnight for Tier 1 employees
  • $650 per fortnight for Tier 2 employees

       8. Complete your declarations by the following 14 th day of the quarter  

Who does this affect?

  • This change predominantly impacts employees who were previously ineligible because they were not employed on 1 March or casuals who were not employed for 12 months leading up to 1 March 2020 who were not eligible.
  • This does not affect those that already qualified on 1 March 2020 and they remain eligible for Jobkeeper until 27 September 2020.  
  • JobKeeper can now apply for anyone who commenced fulltime or part-time work after 1 March 2020 but before 1 July 2020.  
  • Or any long-term casuals who now complete their 12 months of employment ie those who started between 3 March 2019 & 2 July 2019.  
  • Most businesses will use their BAS to assess their eligibility however as BAS deadlines are not due until one month after the end of the quarter eligibility needs to be assessed in advance of the BAS reporting deadlines.  

Example of eligible employees after 1 July 2020 are:

  • an employee who was employed previously and who was stood down and now has returned to work may now be eligible:
  • they stopped being employed by the employer on or before 1 July 2020; they were re-engaged by the employer after 1 July, and they had previously provided the employer with an employee nomination notice.

If you need any assistance in working out your eligibility either as an employer or as an employee please do not hesitate to contact us.

Yours sincerely,

Michael Wunsch

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