RSM Australia

Important changes to the JobKeeper Program

The Treasurer, the Hon Josh Frydenberg has announced the government will make further changes to the JobKeeper payment rules.  We summarise the changes below and will provide further updates when they come to hand.  JobKeeper Payment alternative decline in turnover tests

Service Entities 

After intense lobbying by professional bodies and industry groups, the JobKeeper scheme will be extended to include service entities.  Employees employed through a service entity, rather than the main operating entity, will now be eligible for the JobKeeper Payment provided either the basic decline in turnover test, or proposed alternative decline in turnover test, is satisfied.  The alternative test will apply where an entity provides services of its employees to one or more related entities and where those entities carry on a business of deriving income from unrelated third parties. The alternative test will be by reference to the GST turnover of the related entities using the services of the employer entity.

The change will have particular relevance to the many corporate groups that have legitimately adopted a legal structure using a service entity through which to engage their employees, including but not limited to, medical and legal practices, property development groups and childcare providers. This is a very welcome development and one which we believe reflects the underlying intention of the Federal Government in rendering support to Australian employees adversely affected by the Coronavirus pandemic.  

Full time students aged 16 and 17 years old

Full time students aged 16 and 17 years old who satisfy the basic eligibility criteria, will no longer be eligible for JobKeeper Payment unless they are financially independent.  This change will apply prospectively, so employers who have made the minimum $1,500 to those students who will now be ineligible for the payment, are not financially disadvantaged.  This change will have significant impact on the hospitality and retail industries but will no doubt be welcomed by small businesses struggling to find cash resources to fund up front payment of wages to eligible employees.

Clarification of the one-in all-in principle

The Treasurer has provided clarity surrounding the one-in all-in policy intent of the JobKeeper scheme.  The clarification makes it clear that employers who nominate for the JobKeeper scheme must ensure all eligible employees who have agreed to be nominated are included in the scheme.  The clarification is welcome as employers will now be able to proceed knowing they are not able to ‘pick and choose’ which employees they claim JobKeeper payment for.

Other key changes include: 

  • The ability for charities (other than schools and universities) to elect to exclude government revenue from the turnover test. This will help to ensure charities that deliver significant services that are funded by the government are not disadvantaged.
  • Changes will be made to allow JobKeeper payments to be made to religious institutions in respect of religious practitioners. This recognises that many religious practitioners are not ‘employees’ of their religious institution.
  • Clarification around the on one-in all-in principle. There are also some minor changes that impact on International Aid Organisations and Universities.

We anticipate the changes announced by the Treasurer will be implemented by the introduction of a new legislative instrument. 

Employers impacted by the changes announced on Friday 24th April 2020 are encouraged to contact their local RSM office for advice on changes to eligibility and how this may impact their business.


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