As foreshadowed in our earlier article, on 30 March 2020 the Federal Government announced further COVID-19 business support – the JobKeeper Payment.

Under the JobKeeper Payment, businesses significantly affected by the Coronavirus outbreak will be able to access a subsidy from the Government to continue paying their employees.

Under the scheme, the Government will make a $1,500 support payment per employee per fortnight for up to 6 months (including stood down, and re-engaged employees).

Eligible employers will be those:

with annual turnover of less than $1 billion who self-assess to have a reduction in turnover of 30% or more, since 1 March 2020; or
with an annual turnover of $1 billion or more will be required to demonstrate a reduction in turnover of 50% or more to be eligible.

Businesses subject to the Major Bank Levy will not be eligible.

The fall in turnover is based on turnover in a one-month or three-month period, depending on the usual activity statement reporting period of the business. The Commissioner of Taxation will have the discretion to determine that a business qualifies for the payment, even if for some reason the business is unable to satisfy this criteria. The Commissioner can consider additional factors put forward to demonstrate a business has been impacted, for example, where the business was not operating a year before, or if the previous year's turnover was not representative of its usual turnover. Alternative tests to satisfy the criteria in certain circumstances may also be provided by the Commissioner, for example if a business has ceased or its operations significantly reduced.

Eligible employers include businesses structured through companies, partnerships, trusts and sole traders. Not for profit entities, including charities, will also be eligible.

Employers must elect to take part in the scheme by making an application to the Australian Taxation Office including supporting information showing a downturn in their business.

We will prepare a detailed article on the JobKeeper Payment following the introduction of draft legislation. Treasury fact sheets on the JobKeeper Payment are available here.

For more information please contact:

Neil Brydges
Principal Lawyer | Accredited Specialist in Tax Law
M +61 407 821 157 | T +61 3 9611 0176
E nbrydges@sladen.com.au

Daniel Smedley
Principal | Accredited Specialist in Tax Law
M +61 411 319 327| T +61 3 9611 0105
E dsmedley@sladen.com.au