JobKeeper 2.0 update - Alternative tests confirmed

27 September 2020

As outlined in our eAlert last week, the ATO has released information on the extension of JobKeeper and the changes that will come into effect today (28 September 2020). Please refer to our original eAlert here for further information, including key dates.

On the 22 September 2020, Treasurer Josh Frydenberg released the legislative instrument which outlines the alternative tests for decline in turnover for business entities where there is no appropriate relevant comparison period.

The alternative tests can be used to determine whether an entity has satisfied the actual decline in turnover test for the September 2020 quarter or the December 2020 quarter.

If an entity satisfies the basic test, it does not need to satisfy an alternative test. Also, you only need to satisfy one of the alternative tests listed below even if more than one could apply.

Please be aware that while the alternative decline in turnover tests for JobKeeper 2.0 remain relatively the same, there have been some minor changes made.

Circumstances where an alternative test applies:

  • The entity commenced business after the relevant comparison period but not on or after 1 March 2020
  • The entity acquired or disposed of part of its business from the start of the relevant comparison period but before the applicable turnover test period (for multiple acquisitions or disposals the requirement to use the period after the last transaction has been removed)
  • The entity restructured the whole or part of the entity’s business from the start of the relevant comparison period but before the applicable turnover test (for multiple restructures the requirement to use the period after the last transaction has been removed)
  • The entity’s turnover substantially increased by:
    • 50% or more in the 12 months immediately before the applicable turnover test period or before 1 March 2020, or
    • 25% or more in the 6 months immediately before the applicable turnover test period or before 1 March 2020, or
    • 12.5% or more in the 3 months immediately before the applicable turnover test period or before 1 March 2020.
    • The entity was affected by drought or other declared natural disaster during the relevant comparison period in 2019  
    • The entity has a large irregular variance in their turnover for the quarters ending in the 12 months before the applicable turnover test period or 1 March 2020, excluding entities that have cyclical or regular seasonal variance in their turnover, or
    • The entity is a sole trader or small partnership with no employees where sickness, injury or leave have impacted an individual’s ability to work which has affected turnover.

It is important to note that the actual decline in turnover tests only use quarters, the original decline in turnover tests used months or quarters.

For the purposes of the September 2020 actual turnover test, the start of relevant comparison period is 1 July 2019 and the start of the applicable turnover test period is 1 July 2020.

More information on how to apply the alternative tests can be found on the ATO website here or contact your local Boyce Accountant.

Xero – Changes to the ‘Starter’ Subscription

24 September 2020

Xero have announced an exciting change to the ‘Starter’ subscription. This is the entry level plan for Xero and is available for $17.50/month when purchased through Boyce (RRP $25/month).

Xero Starter Plan now includes;

  • Send up to 20 sales invoices and quotes (previously limited to 5 per month)
  • Enter 5 bills
  • Unlimited bank reconciliations (previously limited to 20 per month)
  • Payroll for 1 person
  • Capture bills and receipts with Hubdoc (limited to 5 bills per month)

This change means that this plan would be ideal for people who;

  • Want to start some invoicing to their customers
  • Want to keep smaller businesses organised with a cashbook that offers an opportunity to take advantage of most of Xero’s features.
  • New businesses that want a cost-effective starting plan that is easy to upgrade as the business grows.
  • Want to keep track of their personal income/expenses and be able to flag deductible expenses

We also have options for Xero plans that are only available through Boyce. See below.

This new package is a great option for any smaller businesses looking to move to Xero or as a downgrade option for any businesses on a larger plan that would be suited to the adjusted ‘Starter’ Plan.

If you would like to take advantage of the new ‘Starter’ plan or discuss other plans with Xero, please feel free to contact your Boyce accountant to work through what suits you best.

Further information released by the ATO regarding JobKeeper 2.0

18 September 2020

The following changes will apply to JobKeeper fortnights commencing 28 September 2020.

Key changes

Actual decline in turnover test:

For JobKeeper fortnights from 28 September 2020 you will need to meet an actual decline in turnover test. An actual decline in turnover test will need to be met for each extension period:

  • Extension 1: from 28 September 2020 to 3 January 2021
  • Extension 2: from 4 January 2021 to 28 March 2021

The actual decline in turnover test is similar to the original decline in turnover test. However:

  • It must be done for specific quarters only. For Extension 1 - September 2020 quarter must be compared to the September 2019 quarter. For Extension 2 - December 2020 quarter must be compared to the December 2019 quarter.
  • You must use actual sales made in the relevant quarter, not projected sales, when working out your turnover
  • You must allocate sales to the relevant quarter in the same way you would report those sales to a particular business activity statement if you were registered for GST.

If you are not eligible for JobKeeper under Extension 1 because you do not satisfy the turnover test, you may still be eligible for JobKeeper under Extension 2 if you satisfy the later turnover test. If the “basic” actual turnover test is not appropriate to your circumstances, an alternative turnover test may be available. Details of the alternative tests are yet to be released by the ATO or Treasury.

Rates of payment

For an employee or eligible business participant to receive the Tier 1 (higher) rate of JobKeeper payments in each extension period they will need to satisfy the 80-hour threshold:

The Tier 1 rate will apply to:

  • Eligible employees who worked for 80 hours or more in the four weeks prior to the last day of the pay period that ended before either 1 March 2020 or 1 July 2020, and
  • Eligible business participants who were actively engaged in the business for 80 hours or more in February 2020 and provide a declaration to that effect.

In some circumstances, alternative reference periods may apply for determining the 80 hour threshold (e.g. where the employee was on unpaid emergency leave during the relevant 4 week period).

Key Dates

  • Businesses will have to wait until the end of September when they complete their BAS before applying the decline in turnover test for the Extension period 1 (as the test is now based on actual GST turnover).
  • For the JobKeeper fortnights stating 28 September and 12 October 2020, the ATO is allowing employers until 31 October to meet the wage condition for employees. 
  • Monthly business declarations for October (the first two fortnights of the extension) will need to be made by 14 November 2020. If you were eligible for JobKeeper 1.0 you need to tell the ATO whether the Tier 1 (higher) or Tier 2 (lower) payment rate applies to your eligible employees or business participants in the monthly declaration form.

For further information please see the ATO website or contact your local Boyce accountant

JobKeeper - ATO Releases Further Information on Change to Employee Eligibility

18 August 2020

Earlier this month the Federal Government announced a key change to the JobKeeper employee eligibility requirements. From 3 August 2020, workers employed from 1 July 2020 and meet the other eligibility requirements will become eligible for JobKeeper.

The ATO has now released further information on this change, and details of how it will be administered.

Please note that this change to employee eligibility will affect the current JobKeeper scheme as well as the extended JobKeeper scheme (JobKeeper 2.0). The change in employment date to 1 July 2020 does not apply for JobKeeper fortnights that ended before 3 August 2020 (that is, employees must continue to satisfy the 1 March 2020 test to be an eligible employee for JobKeeper fortnights ended before 3 August 2020).

Overview of eligibility requirements from 3 August 2020

An employee is an eligible employee for a JobKeeper fortnight starting on or after 3 August 2020 if they:

  • are employed by at any time in the JobKeeper fortnight;
  • didn't receive any of these payments during the JobKeeper fortnight:   
    • government parental leave or Dad and Partner Pay;
    • a payment in accordance with Australian workers compensation law for an individual’s total incapacity for work;
    • agree to be nominated;
    • were either an eligible employee for a JobKeeper fortnight ended before 3 August 2020 using the 1 March test or they meet certain conditions at 1 July 2020 (the 1 July test):
      • At 1 July 2020 they were employed as either a:  
        • non-casual employee; or
        • long term casual employee not a permanent employee of any other employer;
        • they were 18 years or older (if they were 16 or 17, they can also qualify if they were independent or not studying full time on 1 July 2020); and
        • were an Australian resident under the Social Security Act 1991 or a Special Category (Subclass 444) Visa Holder.

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Drought Recovery Funding Takes Effect

13 August 2020

The NSW Government's $310 million drought package has officially kicked off and aims to deliver additional assistance to farmers still battling drought and to accelerate the recovery for those experiencing a reprieve in conditions.

Agricultural Minister, Adam Marshall said they had made a number of adjustments to the new package to ensure it reflected the evolving needs of farmers, particularly as some parts of the state enter drought recovery.

The new package includes:

  • $116 million to continue the Drought Transport Subsidy through the calendar year (pro rata cap of $25,000 per primary producer);
  • $99 million in cost of living pressure relief, including Local Lands Services rates, vehicle registration waivers etc.;
  • $28.5 million to continue water licence fee waivers for stock, domestic, general and high security water users;
  • Continuation of health and well-being programs (Farmgate Counsellors, Royal Flying Doctors Far West drought support programs).

What it means for you

Drought Assistance Fund – the cap has been lifted and now primary producers can obtain up to $100,000 via an interest free loan to implement systems and management practices to enhance the sustainability of their operations. Among other things, it can include transport of stock, fodder and water, cost of restocking as well as the installation of on-farm fodder and water infrastructure. The loan is for 7 years with no repayments required in the first 2 years. For more information on eligibility or to apply online, click here.

Emergency Drought Transport Subsidy – a round two second release and round three has been announced. For the second round, whilst this does not mean you can submit new applications, if you’ve already sent in (prior to 30 June 2020) your application, you now have until the 30 September 2020 to submit invoices dated between 1 July 2019 and 30 June 2020. For the third round, this is open to new applications for expenses incurred between 1 July 2020 and 31 December 2020 and is limited to a $25,000 cap and will cease once funds are exhausted.

This subsidy can be applied to the cost of transporting fodder and water for stock or domestic use, stock to and from agistments, to sale or slaughter. Also note, from 1 July 2019, the was expanded to include transporting chemical, fertiliser and seed to farms.

For more information regarding each ‘round’ of this subsidy or to claim additional invoices, click here.

If you require more information on the funding available, please contact your local Boyce accountant.

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