Federal Government’s JobKeeper Payment wage subsidy announced

On 30 March 2020, the Federal Government announced details of a new wage subsidy called the ‘JobKeeper Payment’.  Employers that want to apply for the wage subsidy will need to register (registration details are contained in the link provided below).

The wage subsidy will provide employers with a fortnightly subsidy of $1,500 per employee for a maximum period of 6 months.  The subsidy will commence to be paid by the Government to eligible employers from the first week of May 2020 but will be retrospectively calculated from 30 March 2020.

In order to apply for the wage subsidy, there are various tests that need to be satisfied:

  • It must be demonstrated that the turnover (i.e. revenue) of the business will be reduced by 30% or more from the same comparable period 12 months ago (if the business turnover of the employer exceeds $1 billion, the threshold is 50% rather than 30%);
  • The particular employee for which the wage subsidy is being applied for must have been employed by the business on 1 March 2020;
  • The particular employee for which the wage subsidy is being applied for must work full time, part time or long-term casual (i.e 12 months or more of casual employment).

In order to obtain the wage subsidy, the wage of the employee must be at least equal to $1,500 per fortnight – if the employee receives a wage of less than $1,500 per fortnight, the employer would not be eligible to receive the wage subsidy unless they firstly ‘topped-up’ the wage of the employee to at least $1,500 per fortnight.

For employees that have already been stood-down, their employer would need to reinstate the employee and commence to pay them a wage of at least $1,500 per fortnight in order to obtain the wage subsidy from the Government.  For employees that have already been made redundant, the employee would need to be re-employed in order for their employer to become eligible for the wage subsidy.

The Government press release also notes that businesses without employees such as sole traders can also apply for the subsidy provided they nominate the individual to which the subsidy request relates.  Further details regarding the scope of this aspect of the subsidy will separately be released.

Click here to access the business.gov.au website which provides further details of the wage subsidy, examples of how it applies to particular employee situations, and the application process.

If you have any further questions, please contact your client service partner at Banks Group on (03) 9810 0700.

Talk to us…

Banks Group is an association of independent firms that operate in Melbourne, Sydney and Auckland under the same trading name. Neither the Melbourne Banks Group, Sydney Banks Group or Auckland Banks Group are partners or agents of each other and shall not be liable for any act or omission of each other. Liability limited by a scheme approved under Professional Standards Legislation

MAG_WEB

All services are provided as a Corporate Authorised Representative of Magnitude Group Pty Ltd (ABN 54 086 266202, AFSL 221557).

Count_WEB

Financial Planning Services provided as an authorised representative of Count Financial Limited ABN 19 001 974 625 Australian Financial Services Licence Holder Number 227232 a wholly-owned, non-guaranteed subsidiary of Commonwealth Bank of Australia ABN 48 123 123 124. Count is a Professional Partner of the Financial Planning Association of Australia Limited. Count advisers are authorised representatives of Count. www.count.com.au

"Please note that any taxation and accounting services are not endorsed nor the responsibility of Count Financial Limited".