Special rules introduced to assist certain businesses calculate their reduction in turnover for JobKeeper Payment registration purposes

On 23 April 2020, the Australian Taxation Office (ATO) issued further guidelines on how a business can determine whether their turnover has reduced by more than 30% to enable the business to enrol for JobKeeper payments.

The guidelines cover specific sets of circumstances where a business cannot otherwise satisfy the requirement of comparing their current turnover with that of 12 months earlier.  The guidelines cover the following specific situations:

  • Situation 1 – Where a business has been operating for less than 12 months.
  • Situation 2 – Where a business has acquired or disposed of another business within the last 12 months meaning their turnover is not comparable to that of 12 months ago.
  • Situation 3 – Where a pre-existing business has restructured within the last 12 months.
  • Situation 4 – Where the business has substantially grown in the last 12 months such that comparing turnover to 12 months ago is no longer relevant to current turnover levels.
  • Situation 5 – Where the business operates from a zone declared as a natural disaster zone due to drought or bushfires.
  • Situation 6 – Where the business has irregular turnover cycles.
  • Situation 7 – Where a sole trader or a partner in a small partnership (a partnership of 4 or fewer partners) has been sick, injured or taken leave.

In the guidelines, the ATO outlines alternative mechanisms for these types of businesses to calculate whether their turnover has declined by more than 30%.

Click here for a copy of the ATO release.

If you have any further questions, please do not hesitate to contact Banks Group to further discuss.

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