On Monday 30 March 2020 the Federal Government announced a third economic stimulus package of $130 billion to retain Australian employees of suffering businesses dealing with coronavirus, COVID-19. Also, on Sunday 29 March 2020 the New South Wales Government announced further Payroll Tax concessions.1. The Federal Government new JobKeeper Payment wage subsidy plan:
Under the new wage subsidy plan, eligible employers will receive a $1,500 per fortnight “job keeper payment” before tax for each eligible employee they keep employed to 30 September 2020. Self-employed workers are also eligible.
The following is the limited detail provided so far, legislation is to still to be prepared and passed by parliament.
- The JobKeeper Payment subsidy starts 30 March 2020 with the first payments to Eligible Employers in the first week of May 2020, backdated to the 30 March start date;
- Subsequent subsidy payments will be paid to the employer monthly in arrears.
Eligible Employers (excluding banks) will be those:
- With a turnover of less than $1billion per annum and their turnover will be reduced by more than 30% in at least one month by 30 September 2020 compared to the same month of the prior year.
- With a turnover of $1billion or more per annum and their turnover will be reduced by more than 50% in at least one month by 30 September 2020 compared to the same month of the prior year.
(As to exactly how the reduced turnover will need to be proven is unclear at this stage).
The employer must have employed the eligible employee as at 1 March 2020 and continue to employ in order to continue to receive the subsidy.
Not-for-profits (including charities) as well as self-employed individuals are also eligible.
Eligible Employees will be those who:
- Are currently employed by the Eligible Employer (including those stood down or re-hired);
- Were employed by the employer as at 1 March 2020;
- Are full-time, part-time, or long-term casuals (a casual employed on a regular basis for longer than 12 months as at 1 March 2020);
- Are at least 16 years of age;
- Are an Australian citizen, the holder of a permanent visa, a Protected Special Category Visa Holder, a non-protected Special Category Visa Holder who has been residing continually in Australia for 10 years or more, or a Special Category (Subclass 444) Visa Holder; and
- Are not receiving a JobKeeper Payment from another employer
- Initially, employers and self-employed can register their interest on-line here:
- Subsequently, employers and self-employed will need to provide further details to the ATO through an online application (has not yet been released).
- Register an intention to apply as per above and assess that they have or will experience the required turnover decline.
- Provide information to the ATO on all Eligible Employees as at 1 March 2020. The ATO will use Single Touch Payroll data to pre-populate the employee details for most businesses.
- Pay each Eligible Employee a minimum of $1,500 per fortnight (before tax).
- Notify all Eligible Employees that they are receiving the JobKeeper Payment.
- Continue to provide information to the ATO on a monthly basis for all Eligible Employees.
- Pay superannuation guarantee contributions based on payments to Eligible Employees.
2. New South Wales Payroll Tax Concessions:Additional concessions have been announced (further detailed information is still to be released):
- Businesses with Grouped Australian Wages over $10 million for the 2019/20 financial year can choose to defer the payment of their payroll tax for up to 6 months, starting with the March month which would normally be due for payment by 7 April 2020.
- Businesses with Grouped Australian Wages of $10 million or less for the 2019/20 financial year can choose to defer their July, August and September 2020 payroll tax payment by up to 3 months. Those business have already been granted a 25% reduction in payroll tax liabilities for the 2019/20 financial year.