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The JobKeeper Payment fact sheet 4 - Receiving payments

April 15, 2020

Under the JobKeeper Scheme the Government will pay eligible employers a wage subsidy, being a flat payment of $1,500 per fortnight per eligible employee for up to 6 months. You must pay your employees the wage subsidy in full, being a minimum of $1,500 per fortnight, before tax.

This webinar provides a brief overview of the JobKeeper Payment and explains how you will receive the JobKeeper Payment.

 

 

Q. When will I receive the first payment?

If your business is eligible for the scheme in April, the first payment will be made by 14 May to cover the first two April ‘jobkeeper fortnights’ which commenced from 30 March.

Q.  If my business is eligible for the JobKeeper Payment do I need to continue to pay my employees their full wages?

Yes, if your business is still operating and your employee is still working.

Example: Your site supervisor Joe earns $3,000 per fortnight before tax. You will receive $1,500 per fortnight from the JobKeeper Payment to subsidise Joe’s salary. You should continue to pay Joe’s full wage, including PAYG and required superannuation based on Joe’s normal income.

Q. I have stood down my employee/s – What should I do?

Employees who are still employed but are no longer working due to there being no useful work  available to undertake as a result of the impact of COVID-19, will receive $1,500 per fortnight before tax.

Example: Your contracts administrator Nicole earns $2,000 per fortnight before tax. Nicole has been stood down due to a lack of work as a result of COVID-19 and is no longer performing work. Nicole will receive $1,500 per fortnight before tax. The employer is required to pay PAYG but is not required to pay superannuation on this amount.

Q. What if my employee earns less than the JobKeeper Payment?

If your employee’s normal wage before tax is less than this amount, the business must pass on the full $1,500 before tax. You will also need to pay the normal superannuation guarantee amount based on the employees pre-JobKeeper wage.

Example: Your receptionist Anne earns $1,000 per fortnight before tax. You will be required to pay Anne the additional $500 per fortnight before tax totalling $1,500 per fortnight before tax.

You will receive $1,500 per fortnight before tax from the JobKeeper Payment which will subsidise Anne’s salary.

The business must continue to pay the superannuation guarantee on the $1,000 per fortnight of wages that Anne is earning. The business has the option of choosing to pay superannuation on the additional $500 (before tax) paid to Anne under the JobKeeper Payment.

Q. Am I required to pay PAYG Withholding?

Yes. The $1,500 per fortnight per employee is a before tax amount and you are required to deduct PAYG from this amount.

Q. Am I required to pay Superannuation?

Where an employee is paid more than $1,500 per fortnight the employers superannuation obligations will not change. Where an employee is having their wages topped up to $1,500 per fortnight by the JobKeeper Payment, it will be up to the employer if they want to pay superannuation on any additional wages paid by the JobKeeper Payment.

Q. I have terminated my employee/s – What should I do?

If your business is still operating and you have employees that were employed at 1 March 2020 you could consider re-hiring those employees under the same, similar or different employment arrangements. For example, you may wish to re-hire a previously full time carpenter on a part time basis or some other basis in accordance with a JobKeeper enabling direction (see Fact sheet #[x]).

Be aware that:

  • employees who have been terminated may be seeking/receiving the JobSeeker Payment. If the employee is rehired, these payments would cease and the employee would receive the JobKeeper Payment instead through your business arrangements.
  • Once re-hired all applicable entitlements will accrue and be available to the employee, for example annual leave and personal leave.
  • You will also need to make superannuation payments based on the employee’s normal weekly wage arrangement.
  • If you have made an employee redundant, a decision to re-hire that employee starts the employment relationship anew, i.e. you cannot ask that the employee return any redundancy payments or other payments related to the ending of that employment.

Overpayments

If a business receives a JobKeeper Payment that it was not entitled to or that is more than the correct amount the business was entitled to, the business will be required to repay the overpaid amount.

A General Interest Charge (GIC) will be charged from the date that the overpayment occurred i.e. that the JobKeeper Payment was made.

There will be a discretion to waive the requirement to repay an overpaid amount in circumstances where an honest mistake was made with no personal benefit.

Examples – JobKeeper Payments in Practice

Example: An employee who (in the absence of the JobKeeper Payment) earned $nil in a fortnight due to being stood down.

Employer payment from the JobKeeper payment

$1,500

PAYG Withholding (claiming tax free threshold)

$192

Net amount paid to employee

$1,308

Superannuation contribution

$nil

Example: An employee who (in the absence of the JobKeeper Payment) earned $1,200 in the fortnight from their employer and received $300 ‘top up’ as a result of the JobKeeper Payment.

Employer payment

$1,200

Top up due to JobKeeper

$300

Total gross

$1,500

PAYG Withholding (claiming tax free threshold)

$192

Net amount paid to employee

$1,308

Superannuation contribution

$114

Example: An employee who (in the absence of the JobKeeper Payment) earned $1,500 in the fortnight from their employer

 

Employer payment

$1,500

Top up due to JobKeeper

$nil

Total gross

$1,500

PAYG Withholding (claiming tax free threshold)

$192

Net amount paid to employee

$1,308

Superannuation contribution

$142.50

 

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Further information

This fact sheet is part of a series on JobKeeper Payment aimed at assisting members understand the requirements. More information is set out in:

#1 The JobKeeper Payment - Overview

#2 The JobKeeper Payment - Eligibility

#3 The JobKeeper Payment - Applying

#5 The JobKeeper Payment – Making changes to working arrangements

#6 The JobKeeper Payment – Record Keeping and Reporting Requirements

The Federal Government has released the following information:

Contact a HIA Workplace Adviser on 1300 650 620 for further information and advice

Current at: 16 April 2020
Reference: NFSIRE1326