JobKeeper changes coming in September
The government has announced changes to the JobKeeper scheme. The Treasury’s review found that the subsidy was still “needed” but required a “test to ensure that JobKeeper is well targeted”.
Where a business has qualified and is receiving JobKeeper, then payments for eligible employees will continue until 27 September with no changes regardless of turnover improvements.
Who will qualify past 27 September?
We expect very few WA businesses will qualify. If we have an unlikely COVID-19 outbreak in WA then the position could change rapidly.
After a slow period in March to mid May, much of the WA economy is experiencing strong conditions so we expect very few businesses will qualify for the extension period. Economic weakness is mainly isolated to inbound tourism and resources (with the notable exceptions of gold and iron ore).
If you don’t qualify for the extension, then your current situation and entitlements are unchanged by these announcements. We will keep you informed as to how this will affect you if the position changes. If you think you are likely to be eligible, then please make contact.
The JobKeeper subsidy has been extended to March 2021, but with some changes. Here is an overview of what’s changing and when.
The next phase of JobKeeper will start at the end of September at a reduced rate. The subsidy will reduce from $1500 per fortnight to $1200 per fortnight for full time workers and those working more than 20 hours per week. For those working less than 20 hours per week will receive $750 per fortnight. This will be based on the amount of hours worked in February (pre-coronavirus).
From 4th January 2021 these payments will fall to $1000 per fortnight and to $650 per fortnight for those working less than 20 hours per week.
Reassessments in October and January
In early October, businesses will need to prove they’re in financial distress (showing a decline of at least 30%) in the June and September 2020 quarters compared to prior years, in order to be eligible for the October – December scheme.
This will need to be proven again in early January based on June, September and December quarter figures.
Please note: details surrounding these changes are yet to be legislated so they are subject to change. If relevant details come to hand, we will pass them on.
Once again we thank you for your support and request your patience as we work through these next set of changes and its ramifications for you.
Once we have all the information on hand from the Government and the ATO and have understood what it means for you, we’ll be in touch.
We have dodged a bullet. Melbourne’s outbreak has demonstrated that the gap between success and failure is small.
Take the time now to prepare for the future. Keep an eye on contingency planning and putting some of the JobKeeper and Cashflow Boost funds into debt reduction, a contingency fund or investment into future business improvements.
We are here to help so please get in touch if you have any questions.