JobKeeper Payments - Alternative Tests - Dalcorp Accounting Services

(updated 28th April 2020)

If your business is unable to pass the basic turnover test for JobKeeper, you may be eligible to apply the alternative tests, details of which were released on the 23rd of April. These tests can be applied to businesses in certain situations where there is not an appropriate relevant comparison period.

Does your business satisfy any of the following 7 scenarios?

you’re a Startup Business
you acquired or disposed of a business
you had a business restructure
you experienced a substantial increase in turnover
your business has been affected by drought or natural disaster
your business has irregular turnover
your a sole trader or small partnership with sickness, injury or leave

Tip: If you are able to meet the basic turnover test, there is no need to apply the alternative test.

Further Rule Changes (Fri 24th April)

The Treasurer, Josh Frydenberg announced on Friday 24 April some important changes to the current JobKeeper rules. These changes will now benefit many who were initial excluded from the original JobKeeper Scheme. It may also however, mean that some 16-17 year old employees will now be excluded.

A summary of the changes are listed below. If you have any questions around these changes please don’t hesitate to contact our office.

Employees employed through a special purpose entity, rather than an operating entity: Changes will address the circumstances where business structures use a special purpose entity to employ staff rather than staff being directly employed by an operating entity. The Government will provide an alternate decline in turnover test for the eligibility of special purpose service entities that provide employee labour to group members and that have not met the basic test for decline in turnover. This alternate test will apply where an entity provides the services of its employees to one or more related entities, where those related entities carry on a business deriving revenue from unrelated third parties. The alternate test will be by reference to the combined GST turnovers of the related entities using the services of the employer entity.
Charities and the treatment of government revenue: Changes will allow charities (other than schools and universities) to elect to exclude government revenue from the JobKeeper turnover test. This will allow employing charities receiving revenue from government to use either their total turnover, or their turnover excluding government revenue, for the purposes of assessing eligibility for the JobKeeper Payment. This will help to ensure that the eligibility of charities is not adversely affected where they are delivering significant services that are funded by government.
Religious practitioners: Changes will allow JobKeeper Payments to be made to religious institutions in respect of religious practitioners (with the exception of those that are students only), recognising that many religious practitioners are not ‘employees’ of their religious institutions.
‘One in, all in’ principle: Once an employer decides to participate in the JobKeeper scheme and their eligible employees have agreed to be nominated by the employer, the employer must ensure that all of these eligible employees are covered by their participation in the scheme. This includes all eligible employees who are undertaking work for the employer or have been stood down. The employer cannot select which eligible employees will participate in the scheme. As noted in the explanatory statement to the existing rules, this ‘one in, all in’ principle is already a key feature of the scheme and will be made clearer in the rules.
Full time students aged 16 and 17 years old: As noted in the explanatory statement to the existing rules, the benefit of the JobKeeper payment to workers over the age of 16 is justified for those who are financially independent and who require the security provided by participation in the JobKeeper scheme and the maintenance of the working relationship that it affords. The rules will provide that full time students who are 17 years old and younger, and who are not financially independent, are not eligible for the JobKeeper Payment. This clarification will apply prospectively, which would mean an eligible employer that has already met the wage condition of paying such an employee $1,500 for a fortnight could be entitled to a JobKeeper Payment in arrears for that fortnight.
International Aid Organisations: Changes will allow entities that are endorsed under the Overseas Aid Gift Deductibility Scheme or for developed country relief to meet the requirement that not-for-profits pursue their objectives principally in Australia. The current requirement that employees must be Australian residents to be eligible under the JobKeeper program would remain in place.
Universities: Changes will clarify that the core Commonwealth Government financial assistance provided to universities will be included in the JobKeeper turnover tests.

Funding the $1,500 payment per employee by 30 April

The Treasurer made the following statement regarding employers funding of the minimum payment to their employee’s and reinforced that these must be paid by 30 April in order to qualify for the JobKeeper payments for the 2 fortnights commencing 30 March 2020:

The banks have also agreed to setup special hotlines to help businesses who need finance to bridge the gap until the first JobKeeper payments are made. The banks have also agreed to bring JobKeeper-related applications to the front of the queue and work with the ATO to accelerate the finance assessment process.
Those Hotline numbers are:

Westpac – 1300 731 073
NAB – 1800 562 533 (1800 JOBKEEPER)
CBA – 13 26 07
ANZ – 1800 571 123

We recommend that anyone who needs assistance to meet their wages obligations under JobKeeper to contact their bank immediately.

Need our Help?

If you would like our assistance assessing the criteria, eligibility or applying for the JobKeeper Payments package and/or other Government stimulus packages, please contact our office to discuss our fees for this service.