The recently announced update to the JobKeeper and JobSeeker payment schemes has given some clarity to Australians who continue to be economically impacted by COVID-19. With no end in sight at present, the Federal Government has needed to explore options to extend the scope of the support measures. When looking to the coming months, this will involve a reduction in the payment amounts. Although the reduced payments will present a challenge for many, there is reassurance in the extension of the schemes further into the future.
There are no changes to the existing JobKeeper regime until September 27, 2020.
“JobKeeper 2.0”, as it is being dubbed, is an extension of the JobKeeper payment system from September 27 to March 28, 2021.
We have summarised the key changes to eligibility criteria below;
- From 28 September 2020 to 3 January 2021, businesses will need to demonstrate that their actual GST turnover has declined by the requisite percentage in the September 2020 quarter only (instead of both the June and September quarters), relative to the corresponding quarter in 2019;
- From 4 January 2020 to 28 March 2021, businesses will need to demonstrate that their actual GST turnover has declined by the requisite percentage in the December 2020 quarter only (instead of each of the June, September and December quarters), relative to the corresponding quarter in 2019;
- Decline in GST Turnover must be assessed against a comparable period, rather than forecasted GST Turnover;
- The decline in GST Turnover must exceed 30% for businesses with a turnover of under $1 billion, 50% for businesses with a turnover of over $1 billion and 15% for not-for-profits and charities; and
- JobKeeper remains open for new recipients to join the program, should they meet eligibility criteria.
Changes have also been announced to the JobKeeper reimbursement amounts:
Reimbursement – September 27 to January 3, 2021
- Full Time Employees: The reimbursement rate will decrease from $1,500 per employee to $1,200.
- Part Time Employees: The reimbursement rate will decrease from $1,500 per employee to $750 if working less than 20 hours per week.
- Business Participants: The reimbursement rate will decrease from $1,500 for business participants to $1,200 or $750, dependent on whether they worked 20 hours per week in the business.
Reimbursement – January 3 to March 28, 2021
- Full Time Employees: The reimbursement rate will decrease from $1,200 per employee to $1,000.
- Part Time Employees: The reimbursement rate will decrease from $750 per employee to $650 if working less than 20 hours per week.
- Business Participants: The reimbursement rate will decrease from $1,200 for business participants to $1,000, or $650, dependent on whether they worked 20 hours per week in the business.
The hours per week will be assessed based on the hours worked by the employee or business participant in the month of February 2020.
The ATO will have the discretion to set out alternative tests in the event that the employee or business participant had not worked their usual hours during February 2020.
We are still awaiting clarification as to whether businesses currently on JobKeeper will need to re-apply in September.
Eligible businesses not currently taking advantage of the JobKeeper regime can still access the program in July, August and September.
No changes to the existing JobSeeker regime will come into effect until September 27, 2020.
Currently, JobSeeker has been topped up with a COVID-19 supplement of $550 per fortnight. From September 27, 2020, the supplement will be reduced to $250 per fortnight. This means that from the September 27, 2020, JobSeeker recipients will receive $815 per fortnight.
In addition to JobSeeker, recipients can earn up to $300 in additional income per fortnight before seeing a reduction in their JobSeeker payments.
While reduced payments will make life more difficult for many who are struggling, there is comfort in the knowledge that plans have been made for those in need well into the future. We will advise on further updates as they come to light. As always, should you wish to discuss or require assistance with any of the above matters, we are available to support you. Please don’t hesitate to get in contact with your Morrows advisor today.