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COVID-19 Business Continuity – 17th August

I’m here with the COVID-19 continuity update for Australian businesses on 17th August:

1. JobKeeper for employees recruited between 1 March and 1 July 2020
2. Payroll tax on JobKeeper top up payments

1. JobKeeper for employees recruited between 1 March and 1 July 2020

From 3rd August, JobKeeper has been extended for employees who joined your business this year between 1 March and 1 July. These changes had been mooted, but have now been confirmed by the ATO.

Also, for long term casuals the eligibility date range has also been extended to 1 July 2020.

These changes are for the current JobKeeper scheme, which is in place now until 27th September.

What that means for your business

If you are in JobKeeper and you recruited a new employee between 1 March and 1 July, you will be eligible to receive the wage subsidy of $1500 per fortnight for your new employee.

Long term casuals who were employed by you on a regular and systematic basis during the 12-month period that ended 1 July 2020 will now be eligible for JobKeeper as well.

What do I have to do to receive JobKeeper for my new employee/s?

You’ll need to follow the same process to nominate your new employee to receive JobKeeper – see here: https://www.ato.gov.au/General/JobKeeper-Payment/Employers/Your-eligible-employees/

You have until 31st August to ensure that you have paid your eligible employees the minimum amount of $1500 per fortnight. For example, if your new employee normally receives $1000 per fortnight, you’ll need to top them up to the minimum of $1500 (before tax) to be eligible to receive JobKeeper for them.

Will there be back pay to 1st July 2020?

No. The JobKeeper payments will only apply to wages you have paid to your new employee from 3rd August onwards.

For further information, see the ATO webpage:
https://www.ato.gov.au/General/JobKeeper-Payment/Employers/Your-eligible-employees/

As always, you can speak with your business coach about how this applies to your business.

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2. Payroll tax on JobKeeper top up payments

As a timely reminder for Victorian business owners, payroll tax is not required to be paid on top-up amounts to meet the JobKeeper minimum of $1500 per fortnight.

This applies to wages paid to employees who are fully stood down and also to top up payments (for example, using the scenario above, you would not have to pay payroll tax on the amount over $1000).

For further information, see this page of the State Revenue Office website:
https://www.sro.vic.gov.au/frequently-asked-questions-response-covid-19

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I know that many Tenfold clients have been seeing their profits increase due to JobKeeper payments, and some business owners I speak to have expressed concern that maybe they shouldn’t be in JobKeeper, that it should be saved for those who need it.

It might assist alleviate those thoughts to know that furniture manufacturer, Nick Scali has received around $4M in JobKeeper payments so far, and homewares company Adairs has received around $11M (including NZ subsidies for their kiwi operations.)

Ash

Ashley Thomson B.Eng(Hons), Grad. Dip. Mgmt, MEI
Managing Director
Tenfold Business Coaching

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