We are just past the halfway mark of JobKeeper 1.0 and as expected the government has announced their intentions for a second round of stimulus/support payments to help employers that continue to be impacted by Covid, extending support for those that need it for another six months to March 2021.
For several months there has been concern about all of the debt and obligations Australian businesses have been able to ‘kick down the road’. Between rent deferrals, pauses on loan payments and ATO payment plans and deferrals, October was looking to be a scary month for many as these cashflow expenses turn back on at the same time that the original JobKeeper and Cashflow Boosts finished.
JobKeeper 2.0 will help many businesses ease back into things instead of falling into a pile of debt with no support.
As always, not all the details are available yet, but this is what we know so far:
What’s not changing?
- The government has kept its promise and there are no changes at this stage to the original JobKeeper scheme
- “If you’re in, you’re in” still holds true and if you have been eligible and enrolled in JobKeeper so far, you will continue to be eligible for payments until 27 September 2020
- Employee eligibility criteria for JobKeeper 2.0 is remaining the same as it is now including the new 1 July 2020 Eligibility Date. Find out more here
- If you become eligible you can still opt in
What’s happening after September?
- Similar to the existing scheme, a business needs to show a downturn in trading to be eligible for JobKeeper 2.0; but the requirements are going to be much tighter and the payment rates will be reduced
- JobKeeper 2.0 will run from 28 September 2020 to 28 March 2021 for eligible businesses (including sole traders)
- JobKeeper will continue to be open to new applicants, so long as they meet the eligibility requirements.
JobKeeper 2.0 Eligibility Requirements:
From 28 September 2020 businesses will need to re-assess eligibility and show an ongoing downturn in business in the September 2020 quarter with reference to Actual GST Turnover (as opposed to estimated GST Turnover under the current scheme) when compared to the September 2019 quarter
Then from 4 January 2021 business will need to again re-assess eligibility and show an ongoing downturn in business in the December 2020 quarter when compared to the December 2019 quarter.
Businesses will need to show:
- 30% downturn for businesses with less than $1billion in turnover
- 50% downturn for businesses with more than $1billion in turnover
- 15% downturn for ACNC registered charities
If you are a business that is only just feeling the effects of Covid and you did not have a drop of income in the September quarter, unfortunately you may miss out. But, you may be eligible from 4 January 2021 onwards if the December quarter shows the required decline in turnover.
New Payment Rates:
Payment rates will change over the 6 month period that the next round of JobKeeper will cover.
From 28 September 2020 to 3 January 2021 payments will be:
- $1,200 per fortnight for eligible employees working more than 20 hours per week, and
- $750 per fortnight for other eligible employees and business participants.
From 4 January 2021 to 28 March 2021 payments will be:
- $1,000 per fortnight for eligible employees working more than 20 hours per week, and
- $650 per fortnight for other eligible employees and business participants.
What about JobSeeker?
JobSeeker is getting a shake-up as well and has been extended to 31 December 2020. However, those receiving the Covid-19 supplement will see a decrease from $550 to $250 a fortnight. This will see people on Jobseeker receiving $800 a fortnight from 25 September down from $1,100.
Here’s a handy infographic that helps explain JobKeeper 2.0 in a nutshell.
Have a question?
Join us at 2pm on Friday 24 July for our next Calm Covid Convo where we will be dissecting the recent announcements and what they may mean for you and your business.