• News
  • 10 April 2020

In an evolving situation with only a short time to act, we’ve focussed here on the more immediate things you need to do. A series of Fact Sheets and Frequently Asked Questions documents with a lot of information on the JobKeeper Payment program have been issued. However, with framework legislation passed, and the detailed rules now finalised by way of delegated legislation, some of that information is now obsolete.

For right now, the two key issues in relation to your business qualifying for JobKeeper payments are:

  1. Continuing to pay your employees the minimum $1,500 pre-tax per fortnight; and
    – You’ve got some extra time for the first two fortnights (see below)
  2. Determining whether you believe you will suffer the threshold decline in turnover.  

There are other, more administrative requirements, but these are what matter for right now.

You must keep paying your eligible employees

There are 13 fortnights in the program, commencing from Monday, 30 March. You qualify for JobKeeper payments on a fortnight-by-fortnight basis.  To qualify for JobKeeper payments for a particular eligible employee for a particular fortnight, you have to pay them the minimum $1,500 (pre-tax) in that fortnight (or reasonably allocated to that fortnight, if the payroll period is longer than a fortnight).

Unfortunately, if you pay them less than this (or, say, nothing, for stood-down employees) during any fortnight, with the intent of catching up when JobKeeper money starts arriving in May, you won’t qualify for the JobKeeper payment for those fortnights in the first place. For fortnights ending in a particular month, JobKeeper payments will be made within 14 days after that month. This means having to fund two, or possibly three, fortnights’ worth of wages from 30 March before receiving any JobKeeper money in early May.

  • An exception was announced on 14 April for the first two fortnights (ended 12 April and 26 April) – you’ve got until 30 April to make any catch-up payments.

It also means taking a risk that, if it turns out you don’t qualify, you can’t claw back those wages paid. At first glance, it seems you could decide to pay particular employees less than $1,500 per fortnight from 30 March (or nothing for stood-down employees), and start paying them the $1,500 minimum only upon receiving confirmation that you qualify (and thus receive JobKeeper payments only from that time). However, this diminishes your chances of retaining those employees, as they are more likely to seek employment elsewhere.

There are few easy decisions here. 

Decline in turnover  

Firstly, ignore most of the Fact Sheet and FAQ information you might have previously read. The actual rules will operate differently.

There are two parts to the decline in turnover requirement: 

  1. Determining the percentage decline threshold that applies to you; and
  2. Determining if you will suffer that percentage decline.

The first part involves grouping business turnover with other entities. Once you have determined your applicable percentage, the second part looks only at the turnover of the entity running the business (there’s no grouping with other entities).

If your group-wide turnover is over $1 billion, the turnover decline threshold is 50%. (Note that an entity is generally grouped with another if there is 40% or more ownership, and grouping includes foreign entities.)  Where group-wide turnover is under $1 billion, the turnover decline threshold is 30%.  For most ACNC-registered charities, the threshold is 15%.

Measuring turnover decline

Having determined the percentage decline threshold that applies to your business, measuring any turnover decline is now a matter of only that entity’s turnover. What constitutes turnover is drawn from the GST rules – it’s not what you see in your P&L or what you disclose at G1 in your BASs. Rather, it’s the “value of supplies” made. The reason for choosing this basis of measuring “turnover” is that it is less susceptible to manipulation.  For example:

  • Retail: usually equates to sales/takings (ie, no debtors)
  • Make/deliver product:
    • Supply made when removed, made available (not when invoiced)
    • Eg, boutique jewellery-maker hands over custom-made ring to customer on 30 April
      • Issues $20k+GST invoice on 1 May
      • $20k is in April’s GST turnover
  • Services:
    • Supplied when performed, entitled to issue bill (whether or not have billed)
    • Professional firms – recoverable WIP produced in the period
  • Progressive supplies (eg, construction)
    • Made in progressive/periodic components

Ignore the types of income that are essentially kept outside the GST system, like interest income, dividends and residential rental income.

You make a comparison between a month or quarter that you're in at the time and the same month/quarter in 2019. This is not tied to whether you are registered for GST as monthly or quarterly. You choose the time-frame comparison. The options are the months of March to September 2020 (compare to equivalent month in 2019), and the June and September quarters (compare to June/September 2019 quarters).


Now, for many of you, you’ll have to make a prediction. But you need to show that you will satisfy the decline in turnover only once. Once you’ve done that, you don’t need to demonstrate satisfying it again.

Let’s say you’re in the 30% turnover decline category (<$1 billion group-wide turnover), as most of you would be. What do you predict your “turnover” will likely be for, say, the month of April? Compare to April 2019. Decline of 30% or more? If yes, you’ve met the turnover decline requirement, and there is no requirement to re-test (even if your turnover subsequently recovers). You’ll provide this information in the enrolment with the ATO (form available from 20 April). After that, there will be an application form for the first month (April, available from 4 May), which will include, which will include your employee information.

Maybe you haven’t yet felt the full effects of the economic fallout from COVID-19, and comparing predicted April 2020 to actual April 2019 won’t show a 30%+ decline in turnover.  If the full effect will come through only in May and June, you could instead compare predicted June 2020 quarter turnover to the June 2019 quarter in your application. 

The ATO has the power to determine alternative ways of measuring turnover decline (eg, for recently started or purchased businesses), but they haven’t released anything yet.

What if your turnover decline ends up being less than the threshold percentage?

It doesn’t automatically mean retrospectively losing your entitlement to JobKeeper payments. Your prediction at the time might have been entirely reasonable, and you had unforeseeable good fortune leading to a lesser turnover decline. But the onus is on you to show your prediction was reasonable. If you can’t, you’ll have to repay the JobKeeper amounts received, with interest.

Directors, etc who don’t take a wage

An entity can nominate one person for JobKeeper payments who is active in the business, but not an official employee, who perhaps takes dividends, trust income, etc instead of a wage.

Webinar recordings with more detail

We have conducted a number of live webinars. However, due to time constraints, we will make a recording available next week with more detail.

What to do now

For right now, register your interest in JobKeeper here, if you haven’t already. This is just to get you into the system, and then the enrolment and application forms will be forthcoming with pre-populated Single Touch Payroll data.

Start compiling evidence to support your predicted turnover going forward. The deadline to submit your enrolment (form released 20 April) covering the first JobKeeper fortnight is 30 April.

For the program overall:

1. Register interest here

2. Confirm you’re an eligible employer

3. Confirm your potential eligible employees

4. Maintain $1,500 minimum

5. Notify 3. above intend to claim JKP on their behalf, check they aren’t nominating another employer.

  • Include standard notice, return to you by 30 April. Keep them (do not need to be sent to the ATO).

6. Enrol from 20 April (by 30 April):

  • Include estimated number of eligible employees for first two fortnights

7. Apply for April (from 4 May):

  • Identify eligible employees from pre-filled STP data (manually, if don’t use STP)
  • Submit, receive confirmation email/text

8. JobKeeper payments for April to follow

9. Submit monthly JobKeeper Declaration report for May onwards

Talk to your trust Nexia advisor about how we can help with your JobKeeper application.

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