Since the Coronavirus Economic Response Package (Payments and Benefits) Rules 2020 (the JobKeeper Rules) were registered on 9 April 2020, there has been confusion among many accountants, tax practitioners and business owners as to what they have to do and by when to receive assistance under the Government’s JobKeeper program.
The confusion was exacerbated by:
- the pace at which the new law was implemented and applied following the Government’s announcement of the JobKeeper program on 30 March 2020;
- the subsequent release of further information including the Commissioner’s legislative instrument, the Coronavirus Economic Response Package (Payments and Benefits) Alternative Decline in Turnover Test Rules 2020 which were registered on 23 April 2020;
- the subsequent amendments to the JobKeeper Rules, the Coronavirus Economic Response Package (Payments and Benefits) Amendment Rules (No. 2) 2020, which were registered on 1 May 2020; and
- at times, the ATO guidance which has continued to emerge in real time as entities have been enrolling in JobKeeper and paying at least $1,500 per fortnight in salaries and wages to eligible employees in order to meet the wage condition.
The following terms are used in this article — based on the terminology used by the ATO’s Online Services — to explain the key JobKeeper dates you need to know:
|Step 1||Enrol business for JobKeeper wage subsidies
Enrol an eligible business that has been significantly affected
|Step 2||Identify employees eligible for JobKeeper wage subsidies
Employers and employees must complete a JobKeeper Employee Nomination Notice
If adding a business participant, entities and eligible business participants must complete an eligible business participant nomination notice
|Step 3||Business monthly declaration for JobKeeper payment
Confirm eligible employees, eligible business participant and GST turnover each month
Related reading: How to apply for JobKeeper payments if you’re affected by COVID-19
JobKeeper key dates: what does the law say?
The discussion immediately below explains the key dates as prescribed by the JobKeeper Rules; but these are adjusted by an explanation of the ATO reporting concessions and deferrals which follows below.
Step 1 — Enrolment in the JobKeeper program
Section 6(2) (for employers) and s. 11(2) (for entities eligible based on business participation) of the JobKeeper Rules requires an entity that elects to participate in the JobKeeper program to enrol by:
- for an entitlement in the first or second JobKeeper fortnights (i.e. ending 12 April and 26 April 2020) — the end of the second JobKeeper fortnight (i.e. 26 April 2020);
- for an entitlement arising in any other fortnight — the end of the fortnight.
The Commissioner has the power to defer the date by which an entity must enrol.
Step 2 — Identify eligible employees and eligible business participant
The JobKeeper Rules do not set out a date by which this information must be provided to the ATO. Section 6(1)(f) simply says the employer meets one of the eligibility conditions if they provide information about the entitlement, including details of the eligible employees, to the Commissioner in the approved form.
Section 11(1)(f) states the same for eligible business participants.
Step 3 — Monthly reporting of GST turnover
Section 16(1) of the JobKeeper Rules require entities that are enrolled in the JobKeeper program to notify the Commissioner of monthly GST turnover information. The month in which a JobKeeper fortnight ends is referred to as the reporting month.
Within 7 days of the end of a reporting month, the entity must notify the Commissioner in the approved form of:
- the entity’s current GST turnover (i.e. the actual GST turnover) for the reporting month; and
- entity’s projected GST turnover for the month following the reporting month.
In this context, current GST turnover means the actual GST turnover for the reporting month, so do not report 2019 turnover.
Related reading: JobKeeper: determining decline in turnover using cash or accruals
JobKeeper key dates: what does the ATO say?
Recognising that some of these dates may be difficult to comply with in practice, the ATO has exercised discretion to extend the JobKeeper enrolment and reporting dates.
The JobKeeper Rules do not set out a date by which the eligible employees/eligible business participants must be notified to the ATO so the ATO has aligned the due dates for enrolment (Step 1) and notifying eligible employees/eligible business participants (Step 2). The ATO has also combined the monthly reporting of GST turnover (Step 3) and reconfirming eligible employees and eligible business participants into the same online form.
The ATO must pay the JobKeeper payments for a reporting month no later than the later of:
- 14 days after the end of the month in which the relevant JobKeeper fortnight ends; and
- 14 days after the entity has made the necessary notifications (i.e. the monthly reporting of GST turnover).
So the ATO will allow an entity until 14 days after the end of the month to report its GST turnover (instead of within 7 days as per the JobKeeper Rules), but taking advantage of this extended time to report will delay the entity’s JobKeeper payments. For example, if an entity did not report its GST turnover for May 2020 until 14 June 2020, the entity may have to wait until 28 June 2020 to receive its JobKeeper payments for May. Generally, however, the ATO will pay JobKeeper payments within a week of the requisite notifications being made.
The table below sets out for each of the 13 JobKeeper fortnights:
- the date by when the wage condition must be met;
- the date by which an entity must enrol in the JobKeeper program (i.e. Step 1);
- the reporting month;
- the date by which entities must notify eligible employees/eligible business participants and report monthly GST turnover (i.e. Steps 2 and 3);
- the month in which the ATO pays the JobKeeper payments; and
- the Monthly JobKeeper payment per eligible employee.
There has also been confusion regarding payroll cycles. The JobKeeper Rules do not require any employer to change their payroll cycle or require them to ensure their payroll cycles conform to the JobKeeper fortnights.
The table below sets out examples of weekly, fortnightly and monthly payroll cycles and how much needs to be paid each pay cycle to meet the wage condition.