Since the announcement by Service NSW on Friday 10 September 2021 that businesses and not-for-profit organisations will be required to confirm their eligibility to continue to receive JobSaver payments, The Tax Institute, Chartered Accountants Australia and New Zealand, CPA Australia, the Institute of Public Accountants and the Institute of Certified Bookkeepers have been working assiduously with the NSW Government.
All options were on the table throughout the consultation, to ensure that an appropriate balance was struck between the policy intent and a practical, flexible outcome for businesses and accountants.
- Retesting for JobSaver and the Micro-business Grant is now required.
- There are multiple options for working out whether the business or not-for-profit organisation has continued to experience the requisite decline in turnover.
- As eligibility will be reconfirmed each fortnight, businesses and not-for-profit organisations may oscillate between qualifying and not qualifying from one fortnight to the next.
COVID-19 business support represents a substantial outlay of public money by the NSW and Commonwealth governments to businesses affected by the Public Health Order. It is important that these funds go only to businesses and not-for-profit organisations (hereafter simply referred to as businesses) in genuine need.
Experience throughout the pandemic indicates that some recipients of COVID-19 business support experience gradual improvements in turnover as their business adapts and may no longer need support. Accordingly, it is important to ensure that support is targeted to those businesses that are affected but also that public money is not paid to businesses that have recovered.
Both JobSaver and the Micro-business Grant are recurring fortnightly payments, not one-off grants, so the NSW Government has decided that, from mid-September, businesses should retest to continue to receive payments under both programs. Broadly, businesses will continue to be eligible for support if they continue to experience a decline in turnover of 30% or more.
Explanation of retesting requirement
A business will need to reconfirm its eligibility to continue to receive the JobSaver Payment for the period from 13 September to 26 September 2021, and for the Micro-business Grant for the period from 20 September to 3 October 2021.
Further information is available from the Service NSW website on reconfirming eligibility for:
- the JobSaver payment (see also Common Questions); and
- the Micro-business Grant (see also Common Questions).
The remainder of the discussion below is written in relation to the JobSaver payment but applies equally to the Micro-business Grant.
How to reconfirm eligibility
Each fortnight, the business will need to confirm that:
- The employee headcount on 13 July 2021 stated in the initial application has been maintained; and
- The business has continued to experience a decline in turnover of at least 30%.
If the business is closed from 13 September to 26 September 2021 and cannot trade during this period due to the Public Health Order, the business can confirm its eligibility without doing any further work.
Alternatively, the business can work out whether it has experienced a decline in turnover from 13 September to 26 September 2021 due to the Public Health Order of 30% or more using one of following three options (note that the same option must be used when reconfirming the business’ eligibility in future):
OPTION 1 — If your initial comparison period was in 2019 or 2020, use the same year but the corresponding fortnight as the current fortnight (rolling comparison period)
This option is available to a business that has experienced a decline in turnover of 30% more due to the Public Health Order compared to the same period in 2019 or 2020. You must use the same year (i.e. 2019 or 2020) for the comparison period as you chose in your initial application.
For example, if you initially compared the period 26 July to 8 August 2021 to 26 July to 8 August 2019, and you are now testing 13 September to 26 September 2021, then your comparison period is 13 September to 26 September 2019. You cannot use 13 September to 26 September 2020 as your comparison period in this example.
OPTION 2 — If your initial comparison period was in 2019 or 2020, use the same comparison period that was used in the initial application (static comparison period)
This option is available to a business that has experienced a decline in turnover of at least 30% due to the Public Health Order compared to the fortnight in 2019 or 2020 that was used as the comparison period for the initial JobSaver application.
For example, if you initially compared the period 26 July to 8 August 2021 to 26 July to 8 August 2019, and you are now testing 13 September to 26 September 2021, then your comparison period remains 26 July to 8 August 2019. This comparison period will remain fixed for all future periods.
OPTION 3 — If you used 12 June to 25 June 2021 as your initial comparison period, you must use that same period that was used in the initial application (static comparison period)
This option is available to a business that has experienced a decline in turnover of at least 30% due to the Public Health Order compared with the two-week period immediately before any NSW restrictions (12 to 25 June 2021 inclusive).
For example, if you initially compared the period 26 July to 8 August 2021 to 12 June to 25 June 2021, and you are now testing 13 September to 26 September 2021, then your comparison period remains 12 June to 25 June 2021. This comparison period will remain fixed for all future periods.
You will not need to provide any additional evidence or attach any documentation when reconfirming your eligibility. However, you will need to maintain adequate records to show evidence of your eligibility if required.
The person making the declaration on behalf of the business (this can be the business owner or a qualified accountant, registered tax agent or registered BAS agent acting for the business) will also need to declare that:
- They understand that it is an offence under the Crimes Act 1900 (NSW) to provide false or misleading information to a public authority; and
- They understand that they will receive fortnightly communications from Service NSW about the business’ eligibility for JobSaver payments.
The JobSaver Common questions on reconfirming eligibility will answer many of your question, however, some of the key points are reproduced below.
What is a comparison period?
The comparison period means the period in 2019, or 2020, or the period from 12 June to 25 June 2021, that was compared to the turnover in a period starting on or after 26 June 2021 to work out whether the business experienced the requisite decline in turnover due to the impact of the Public Health Order.
If the comparison period used in the initial application was more than two weeks (e.g. a three-week period, four-week period or five-week period), the turnover amount for the comparison period must be converted to a fortnightly amount for comparison purposes to the current turnover by dividing by the number of days in the period and multiplying by 14.
Does this mean a business can oscillate in and out of JobSaver?
JobSaver is not a one-off test. As eligibility will be reconfirmed each fortnight, businesses may oscillate between qualifying and not qualifying from one fortnight to the next. A business can exit and re-enter JobSaver multiple times.
Becoming ineligible for one fortnight does not disqualify a business from becoming eligible again in a future fortnight where the eligibility conditions are met. A business does not need to re-apply.
- Don’t worry if you don’t reconfirm by the due date. You won’t miss out on the payment for that fortnight. The reconfirmation option will remain open for each payment period for the duration of the program. Payment will be received within five business days of a business reconfirming their eligibility. September payments will continue even if a business doesn’t reconfirm eligibility, however any payments after that will be processed once eligibility is confirmed.
- You can also delay reconfirming for a particular fortnight until the business has finalised its month-end accounting records. A business can reconfirm for multiple fortnights in one go. The myServiceNSW account will show the fortnights for which confirmation is still required.
- A business that has some turnover but remains impacted by the Public Health Order will need to re-calculate its turnover before eligibility is reconfirmed. However, where the business continues to be impacted by the Public Health Order and it is clearly apparent that it continues to experience the requisite decline in turnover, the business can indicate that it still meets the decline in turnover requirement.
Example: If your business had a decline in turnover of 50% when you first applied, and your turnover has only increased by 20% since then, this means your business continues to experience a decline in turnover of 30% or more and is still eligible for JobSaver payments.
Across our membership, practitioners have been confused and concerned about what the new retesting requirement means. Our webinar next Tuesday 21 September is free for members, and will explain the new retesting requirement and answer your questions with a live Q&A. A comprehensive slide pack, including analysis, summaries and insights will also be provided. A recording of the webinar will be available after the session.