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JobKeeper 2.0 fact sheet 4 - receiving payments

JobKeeper 2.0 will provide eligible employers with a wage subsidy to eligible employees from 28 September to 28 March 2021. JobKeeper 2.0 is an extension of the original JobKeeper Payment (JobKeeper 1.0) which will end on 27 September.

JobKeeper 2.0 has made changes to the amount of the wage subsidy and the turnover test:

JobKeeper 1.0 JobKeeper 2.0
Eligible employees average hours worked in 28 days before 1 March 2020 or 1 July 2020 30 Mar 2020 - 27 Sept 2020 28 Sept 2020 - 3 Jan 2021 4 Jan 2021 - 28 Mar 2021
More than 20 hours $1,500 per fortnight
$1,200 per fortnight $1,000 per fortnight
Less than 20 hours $750 per fortnight $650 per fortnight
Turnover Test GST turnover has or will be reduced by more than 30 % relative to a comparable period a year ago. Must demonstrate a 30% decline in actual GST turnover during the relevant quarter.
Turnover Test Period A month or quarter, compared to the same month or quarter in 2019 (March 2019 compared to March 2020 or quarter starting on 1 July 2020 compared to the same quarter in 2019). September quarter 2020 (July, August, and September) compared to the same quarter in 2019. December quarter 2020 (October, November and December) compared to the same quarter in 2019.

Q. If my business is eligible for JobKeeper 2.0 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 $1,200 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 $1,200 per fortnight during the September quarter (or $750, whichever applies) 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 $1,200 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 relevant amount under JobKeeper 2.0?

If your employee’s normal wage before tax is less than this amount, the business must pass on the full $1,200 (for example) 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 $200 per fortnight before tax totalling $1,200 per fortnight before tax.

You will receive $1,200 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 $200 (before tax) paid to Anne under the JobKeeper Payment.

Q. Am I required to pay PAYG Withholding?

Yes. The JobKeeper Payment 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 relevant amount under JobKeeper 2.0, for example, $1,200 per fortnight the employers superannuation obligations will not change. Where an employee is having their wages topped up 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 or 1 July 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 #5).

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 $1,200
PAYG Withholding (claiming tax free threshold) $118
Net amount paid to employee $1,082
Superannuation contribution $nil

Example: An employee who (in the absence of the JobKeeper Payment) earned $1,000 in the fortnight from their employer and received $200 ‘top up’ as a result of the JobKeeper Payment

Employer payment $1,000
Top up due to JobKeeper $200
Total gross $1,200
PAYG Withholding (claiming tax free threshold) $118
Net amount paid to employee $1,082
Superannuation contribution $95

Example: An employee who (in the absence of the JobKeeper Payment) earned $1,200 in the fortnight from their employer

Employer payment $1,200
Top up due to JobKeeper $nil
Total gross $1,200
PAYG Withholding (claiming tax free threshold) $118
Net amount paid to employee $1,082
Superannuation contribution $114

Further information

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

#1 JobKeeper 2.0 - Overview

#2 JobKeeper 2.0 - Eligibility

#3 JobKeeper 2.0 - Applying

#5 JobKeeper 2.0 – JobKeeper enabling directions

#6 JobKeeper 2.0 – Record Keeping and Reporting Requirements

The Federal Government and ATO has released the following information to assist businesses understand the scheme:

Contact a HIA Workplace Adviser

1300 650 620

or email enquiry@hia.com.au

Current at: 25 September 2020
HIA ref no: NFSIRE1366

 

Fact sheet 1 | Fact sheet 2 | Fact sheet 3 | Fact sheet 4 | Fact sheet 5 | Fact sheet 6