Job Keeper Allowance – for now, we have more questions than answers…

Today, the Federal Government has announced the “Job Keeper Allowance”, a wage subsidy to be paid to employers and sole traders (at this stage no clear statement regarding non-employer partnerships, trusts or companies, but hopefully there will be more detail on this once the legislation is passed)

Some of the key statements made by the Prime Minister and Treasurer today, as we understand them, have included:

– To be eligible, a business must be able to demonstrate they have had a minimum drop in turnover (sales or revenue) of 30%, assessed on a monthly basis as compared to the prior year

– It is currently designed to apply to full-time, part-time and casual employees (of greater than 12 months service) together with sole traders (not clear on what structures this does or does not cover)

– it is to be a flat payment of $1,500 per fortnight before applicable taxes

– if eligible, employers are required to pay eligible employees at least the $1,500 gross per fortnight and the subsidies will be backdated to today (but will be paid in arrears and won’t commence being paid until May)

If you are a business (sole trader or employer) who believes they will be eligible to meet the turnover test then you will need to

– register with the ATO to confirm your intention to claim (ATO Job Seeker Registration);

– lodge an application with the ATO (details to come) including providing supporting documentation to show the business turnover has reduced by 30% or more

– pay eligible employees the minimum amount and for more detail on the requirements, see the fact sheet below

– Businesses without employees, will need to provide their ABN, nominate an individual to receive the payment, provide the nominated individual’s tax file number and a declaration regarding the business activity reduction

If you are an employee, you need to contact your employer to see if they are eligible for this subsidy, if they have or will be registering for this with the ATO and when they will commence the payment to you (you cannot receive both the Job Keeper Payment and the Job Search allowance)

Some detail has been provided in the factsheets from Treasury, copied below.

There are still many unanswered questions which hopefully will be resolved and clarified in the next few days. In the meantime, we recommend you consider your position carefully, contact us to discuss, register your intent to claim (if you are an eligible business or expect to be) and/or contact your employer to clarify their position on this.

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