BW 2021 - 2022 Federal Budget Final

The 2021 – 2022 Federal Budget

May 12th, 2021 Posted by Businesses, Federal Budget, News, Superannuation No Comment yet

Individuals

The 2021 – 2022 Federal Budget was handed down last night and it has been described as a labour style Budget given the level of spending.  What does the Budget mean for you as an individual?  Below are the main items that will impact you from a taxation perspective:

a. Resident Individual Marginal Tax rates

The changes to marginal tax rates arose from prior year Budgets so the announcement last night was simply a reinforcement that the tax cuts announced in the 2019 and 2020 Budgets will remain and be implemented according to the time table previously announced.  The personal marginal tax rates for resident individuals are as follows:

For the years ending 30 June 2021, 2022, 2023 and 2024 are:

$0 – $18,200Nil
$18,201 – $45,000 Nil + 19% of the excess over $18,200
$45,001 – $120,000$5,092 + 32.5% of the excess over $45,000
$120,001 – 180,000$29,467 + 37% of the excess over $120,000
$180,001 & over$51,667 + 45% of the excess over $180,000

For the years ending 30 June 2025 and beyond the resident individual marginal tax rates are:

$0 – $18,200 Nil
$18,201 – $45,000Nil + 19% of the excess over $18,200
$45,001 – $200,000  $5,092 + 30% of the excess over $45,000
$200,001 & over $51,592 + 45% of the excess over $200,000

b. Non-Resident Marginal Tax Rates

The marginal tax rates for non-resident individuals for the period 1 July 2020 through to 30 June 2024 are:

$0 – $120,000  32.5%
$120,001 – 180,000$39,000 + 37% of the excess over $120,000
$180,001 & over $61,200 + 45% of the excess over $180,000

The marginal tax rates for non-resident individuals for the period 1 July 2024 and beyond are:

$0 – $200,000 30%
$200,001 and over $60,000 + 45% of the excess over $200,000

c. Low & Middle Income Tax Offset (LMITO)

The Low & Middle Income Tax Offset (LMITO) that was introduced for the 2020 tax year has been extended for an additional tax year and will now be with us until 30 June 2022.  

For those taxpayers with a taxable income of less than $37,000 the LMITO is capped at $255 and there are shading in provisions for those with taxable incomes  between $37,001 and $48,000.

Those taxpayers whose taxable income is between $48,001 to $90,000 the LMITO is capped at $1,080.  There are shading out provisions for those on income between $90,001 and $126,000.  Any taxpayer with a taxable income greater than $126,000 will not be entitled to the LMITO.

d. Low Income Tax Offset (LITO)

The Low Income Tax Offset (LITO) remains unchanged from what was announced in the 2020 Budget.  Eligibility to receive the LITO works as follows:

  • If your taxable income is $37,500 or lower, the LITO is $700
  • If your taxable income is between $37,501 and $45,000 the LITO is calculated using the formula $700 – ([Taxable Income – $37,500] x 5%)
  • If your taxable income is between $45,001 and $66,668 the LITO is calculated using the formula $325 – ([Taxable Income – $45,000] x 1.5%)
  • If your taxable income is greater than $66,668 you are not eligible to receive the LITO

e. Child Care Subsidies

With effect from 1 July 2022 (i.e. not next financial year but the following year) the child care subsidy available to families with more than one child aged 5 and under in child care will increase by 30% for the second and third child.  In addition, the Government has mandated to remove the $10,560 cap on the Child Care Subsidy.

f. Primary Residency Test for Individuals

The Government has proposed that the existing tax residency tests for individuals will be replaced with a primary test whereby a person who is physically in Australia for at least 183 days in any income year will be considered to be an Australian tax resident for that income tax year.  If an individual were to fail the 183 day test then there will be a secondary test that will be more objective and will be based on a combination of physical presence in Australia and other criteria.  Based on case law this secondary test will be based on the individual facts of that individual.

g. Employee Shares Schemes

Under the existing rules for employee share schemes (ESS) an employee who defers the taxing point on any employee shares when granted is taxed at a future point in time.  Termination of employment is an event that causing the taxing point on the employee shares to be incurred.  The Government has announced that they will remove termination of employment as a potential taxing point.  Under the new rules the taxing point can extend beyond termination of employment to the earliest of:

  • For shares – when they are no longer subject to a real risk of forfeiture and/or have no genuine sales restrictions
  • For rights/options – after the exercise of the options where the shares are no longer subject to a real risk of forfeiture and/or genuine sales restrictions

There will be a maximum deferral period of 15 years from the date the shares/options were granted.


Businesses

As we said in our 2020 Federal Budget newsletter last year, the Government missed an opportunity to assist the hospitality and entertainment sectors by not abolishing the Fringe Benefits Tax regime (FBT).  As FBT only accounts for approximately 1% of the Government’s revenue it would have been an opportunity to promote economic activity in that sector.  This Budget was also a missed opportunity for these sectors especially when you consider the number of small businesses that could be positively affected.  While businesses and employees may take advantage of the removal of the FBT regime, the solution may be to exempt meal and entertainment fringe benefits up to a limit based on a percentage of turnover/sales. 

There was not much in the Budget for small to medium sized businesses.

The following is a summary of what we believe to be the main announcements that will affect businesses:

a. Temporary Full Expensing of  Depreciable Equipment until 30 June 2023

The full expensing of depreciable equipment has been extended by 12 months such that it will now cease on the 30 June 2023 (rather than 30 June 2022).

Eligible businesses are able to deduct the full cost of eligible depreciating assets acquired after 6 October 2020 and first used or installed ready for use by 30 June 2023.

b. Temporary Loss Carry-Back Rules Extended to 30 June 2023

The Government announced that the temporary loss carry-back rules will be extended for a further 12 months such that the loss carry-back rules can be used up until the 2023 tax year.

Companies with an aggregated annual turnover of less than $5b can carry back losses incurred in an eligible tax year against profits derived in a previous tax year to generate a taxable refund.  Tax losses incurred by an eligible business in the 2020, 2021, 2022 and/or the 2023 tax year can be offset against previously taxed profits as far back as the 2019 tax year.

The loss carry-back provisions cannot be accessed if the utilisation of these rules would cause a company’s Franking Account to go into deficit.  If you choose not to utilise or are not in a position to utilise the carry-back loss provisions then the losses incurred will continue to be carried forward and available to be used subject to the normal provisions regarding the recoupment of prior year tax losses.

c. Superannuation Guarantee Charge

  • Under the current rules, if an employee does not earn at least $450 in a month, the employer is not required to make any superannuation contributions on that employee’s behalf.   Last night the Government announced that it will remove this minimum income threshold.  This means that employers will now have to pay the Superannuation Guarantee Charge (SGC) for all employees irrespective of the amount earned in a particular month.
  • There was no change to the previously legislated SGC rates.  This means that from the 1 July 2021 the SGC rate payable by employers will increase from 9.5% to 10%.  This rate will then continue to increase each year by 0.5% until it reaches 12% for the 2026 tax year.

Superannuation

At first glance there did not seem to be much in the budget in relation to superannuation.  However, there are some key changes announced that will assist clients and these are:

a. Repealing the Work Test for Voluntary Contributions

At present if a person aged 67 to 74 wishes to make a non-concessional contribution to superannuation they are unable to do so unless they satisfy the work test which requires that person to have worked, for reward, for a minimum of 40 hours in a 30 day consecutive period.  The Government announced in the Budget last night that they would remove the work test for those aged 67 to 74 so these people can continue to make non-concessional superannuation contributions.

Importantly, the existing contribution caps remain and you must ensure that any contributions are within the existing caps.  The non-concessional cap for 2021 is $100,000 per person and for the 2022 tax year and beyond this non-concessional cap will increase to $110,000.

b. Changes to Residency Rules

Presently if you are a member of a SMSF and you temporarily relocate overseas you have a two year window in which you can continue to manage your superannuation fund without breaching the residency rules.  After the two years has expired, if you wish to maintain the self managed superannuation fund (SMSF) you must appoint an attorney (having been appointed under a Power of Attorney) to take your place as the individual trustee or the director of the corporate trustee.

The Government announced in the Budget that this 2 year residency test will be extended to 5 years.  This is a welcome change and hopefully will be enacted shortly.

c. Reducing the Age for Downsizer Contributions

The Government introduced “Downsizer” contribution rules which allowed persons aged 65 or above to contribute up to $300,000 each to their superannuation from the proceeds of the sale of their main residence if they had owned their main residence for a period of 10 years or more.  In last night’s budget it was announced that the eligibility age will be reduced from 65 years of age to 60 years of age.

d. SMSF Legacy Pensions

Many years ago now the Government at the time removed the ability of SMSFs from commencing a variety of life time retirement income stream products that could be accessed by those in retail and industry funds.  For those who entered into such products prior to the changes they are most likely in their last 70s or older.  The attraction for using such products was usually related to the concessional Centrelink treatment that would enable them to qualify to receive an aged pension.

In the Budget last night it was announced that the Government will offer members of SMSFs with these legacy pension products a two year window to exit these pensions (and any associated reserves).  Members will be able to commute these pensions, transfer them back to accumulation phase and then commence an account based pension.  This will present an opportunity for members of SMSF with these products to re-assess their retirement pensions and their retirement strategies.

However, while this is an opportunity to restructure your pension.  Much thought must be given to the implications of commuting such legacy income streams as the Government stated that the social security and taxation treatment will not be grand-fathered.  Any commuted reserves will be taxed as an assessable contribution.

As with any re-assessment of retirement income stream strategies, the impact on your Transfer Balance cap must be considered prior to undertaking any changes to existing arrangements.

e. First Home Super Saver Scheme

The maximum releasable amount of voluntary concessional and non-concessional contributions under the First Home Super Saver Scheme will increase to $50,000 (up from $30,000).  Any contributions made from 1 July 2017 up to the existing limit will count towards the amount able to be released.


If you would like to discuss how the 2021 – 2022 Federal Budget may impact you please contact our office.

Federal Budget Individuals

The 2020 – 2021 Federal Budget – Individuals: What is in it for you?

October 7th, 2020 Posted by Businesses, Federal Budget No Comment yet

The October 2020 Budget was being built up by many as a budget for the ages.  In reality there was good news for individual taxpayers who will receive tax cuts and for welfare recipients who will receive two additional payments $250 (one in December 2020 and one in March 2021). 

Apart from these measures there was not much in the budget for individuals.  We have summarised the key points from the budget as they relate to individuals below.

Personal Tax Cuts

In the previous Budget the Federal Government promised to deliver individual tax cuts progressively over a number of years. In this year’s Budget the Government has proposed to bring forward those Stage 2 personal income tax cuts from 2022-23 to 2020-21. The new proposed individual tax brackets will be as follows and take effect from 1 July 2020:

Tax Bracket

$0 – $18,200

$18,201 – $45,000

$45,001 – $120,000

$120,001 – $180,000

$180,001 +

Rate of Tax Payable

0%

19%

32.5%

37%

45%

In addition, Stage 3 of the personal income tax cuts will now take effect fro, 1 July 2024 and will be as follows:

Tax Bracket

$0 – $18,200

$18,201 – $45,000

$45,001 – $200,000

$200,001 +

Rate of Tax Payable

0%

19%

30%

45%

Low Income Tax Offset

For a number of years the Low Income Tax Offset (LITO) has been set at a maximum of $445. If your taxable income was $37,000 or less then you were entitled to the full LITO of $445. The LITO reduced by $0.015 for every $1.00 of taxable income you earned over $37,000. The LITO cuts out fully if your taxable income was $66,667 or above.

The Budget proposes to increase the LITO from $445 to $700.  The phase out rates will alter such that the LITO will be nil for anyone earning more than $66,667.  That is, if your income is $37,000 or below you will receive the full new LITO of $700.  If your income is between $37,001 and $45,000 the LITO will reduce by an amount of $0.05 for every dollar of income above $37,000.  Beyond $45,000 of taxable income the LITO will continue to be phased out at the rate of $0.015 for every dollar above $45,000.  There is no entitlement to receive the LITO if your taxable income is greater than $66,667.

Low & Middle Income Tax Offset (LMITO)

The LMITO was introduced in the 2019 tax year and provided low and middle income earners with an additional tax offset ranging from a minimum of $255 if your taxable income was below $37,000 to a maximum tax offset of $1080 if your taxable income was between $48,001 and $90,000. The LMITO reduces by 0.03 for every $1.00 of taxable income that you earned over $90,000 and phased out to $Nil if your taxable income was above $126,000.

The Budget confirmed that the LMITO will remain in place for the 2021 tax year but 2021 will be its final year. The LMITO amounts will remain the same as 2020.

Taxable Income

$37,000 or less

Between $37,001 and $48,000

$Between $48,001 and $90,000

$Between $90,001 and $126,000

LMITO Available

$225

$225 + $0.075 per $1.00 above $37,000 up to a maximum of $1080

$1080

$1080 less $0.03 for every $1.00 above $90,000

Aged Pensioners & Other Welfare Recipients

Aged pensioners will receive two $250 payment from the Government. The first of these $250 payments will be paid in December 2020 and the second payment will be made in March 2021.

These two $250 payments will also be paid to those on disability support pensions, carer payments, recipients of Family Tax Benefit, carer allowance and certain Veterans’ affairs payments. The payments will also be made to holders of pensioner concession cards, Commonwealth Seniors Health Care cards and Veterans’ concession cards.


If you would like to discuss how the 2020 – 2021 Federal Budget may impact you please contact our office.

Federal Budget Businesses

The 2020 – 2021 Federal Budget – Businesses: What is in it for you?

October 7th, 2020 Posted by Businesses, Federal Budget No Comment yet

While the Government has invested a significant amount of money through JobKeeper to encourage and assist businesses to maintain its workforce and keep people employed, this Budget was a little disappointing for businesses.

The budget was a greater disappointment for small businesses than perhaps for medium to large business as they will most likely gain more benefits from the immediate asset write off and the temporary loss carry back provisions.

Thinking about the sectors that have been hardest hit by COVID-19 we think of tourism and hospitality. The abolition of Fringe Benefits Tax (FBT) was an opportunity forgone. The abolition of FBT would have encouraged businesses to be able to:

  1. spend money entertaining clients and staff at restaurants, pubs, clubs, sporting/entertainment events.
  2. spend money on sending employees to conferences within Australia whether they be interstate or regional areas as this would have supported airlines, hotels, conference centres, local businesses such as cafes and restaurants.
  3. provide non-cash rewards for employees such as air travel, hotel accommodations, restaurant vouchers etc.

Based on the Government’s expected revenues for 2020/21, Fringe Benefits Tax accounts only 0.825% of the forecast revenue. Given that other parts of the Budget are trying to encourage businesses to spend on depreciable assets, why would we not encourage businesses support tourism and hospitality which employs a significant percentage of the workforce. The abolition of FBT would have been of greater assistance to small businesses across Australia. It would be interesting to see financial modelling of the costs and benefits of abolishing FBT.

Rather than continuing to focus on what the missed opportunity was, lets now focus on what the Budget is offering businesses.

Immediate write off of depreciable assets

On 12 March this year, the Government offered businesses the ability to an immediate write off of the cost depreciable assets acquired and installed ready for use between 12 March and 31 December 2020.

The budget has taken this measure much further in an effort to encourage businesses to invest in their future. The Government announced that businesses with a turnover of below $5.0b will now be able to fully expense any depreciable asset acquired after 7.30pm on 6 October and first used or installed ready for use by 30 June 2020.

The cost of improvements to existing eligible depreciable assets made during this period can also be fully expensed.

Importantly for small businesses (i.e. a business with an aggregated annual turnover of less than $10.0m) they will be able to claim a tax deduction for their simplified depreciation pool at the end of the income year while the full expensing of depreciable assets applies.  Further, the restriction preventing small businesses from re-entering the simplified depreciation regime for 5 years if they opt out will continue to be suspended for the time being.

Temporary loss carry back

In an attempt to assist business cash flow in the current COVID-19 environment the Government has re-introduced loss carry back rules.

Under the loss carry back rules it is proposed that companies with turnover up to $5.0b will be able to apply tax losses incurred in the 2019/20, 2020/21 and/or the 2021/22 tax years to offset tax paid in the 2018/19 or later tax years.

The tax refund will be available for eligible businesses when they lodge their 2020/21 and 2021/22 income tax returns.

The tax refund will be limited by requiring that the amount carried back is not more than the earlier taxed profits and that the carry back does not generate a franking account deficit for the company.

JobMaker Hiring Credit

A business that hires a worker between the ages of 16 and 35 years during the 12 months commencing 7th October will be eligible for either a $200 credit per week or a $100 credit per week provided that the new employee was receiving JobSeeker Payments, Youth Allowance (other) or Parenting Payment for at least 1 month of the previous 3 months when employed.

The $200 credit per week will be payable where the new employee is aged between 16 and 29 years of age. Where the new employee is aged between 30 and 35 years of age the employer will be entitled to receive a weekly credit of $100 for up to 12 months.

The disappointing thing with the JobMaker Hiring Credits is that it is forgetting about supporting those completing university or the like where they have worked and studied hard and saved the Government money by not being on JobSeeker, Youth Allowance or in receipt of Parenting Payments. We should be encouraging businesses to employ young people irrespective of whether they were receiving some form of Government assistance or not. Again, I think the Government has narrowed the focus unnecessarily.

Taxability of the Victorian Government COVID-19 Business Support Grants

As previously announced by the Government the Victorian Business Support grants for small and medium businesses will not be taxable.  They have been determined to be non-assessable, non-exempt income.  This means that they are not included in your business income tax return.  Importantly, this only applies to grants announced on or after 13 September and for payments made between 13 September and 30 June 2021.

Fringe Benefits Tax

As mentioned in our introduction the Government missed a golden opportunity to make this Budget about rebuilding small businesses by not abolishing FBT.  The exemption that has been introduced again is not really about small businesses but more focussed on medium to large businesses who have the financial resources to retrain or reskill employees that are redundant or soon to be redundant.

Currently if an employer provides training to a redundant or soon to be redundant employee and the training does not have a sufficient nexus or connection to the employee’s current employment then the cost of the retraining or reskilling is subject to FBT.  By making such reskilling and retraining programs exempt from FBT it is hoped that more employers will support the reskilling and retraining of redundant employees.

The Government also announced that it would give the Commissioner of Taxation the power to allow employers to rely on existing corporate records rather than employee declarations and the like to finalise their FBT returns.  It sounds positive but the problem is that businesses are at the mercy of the Commissioner of Taxation and his/her officers to determine whether our records are sufficient.  If anything, it creates uncertainty rather than reducing red tape.  It will simply make it easier for the Commissioner to turn around and say your records are inadequate and hit you with an amended assessment for your FBT return.  How is giving the Commissioner a discretion to determine what is and is not adequate record keeping going to save on record keeping? 

Research & Development Tax Incentive

For small companies (i.e. with an aggregated turnover of less than $20.0m) the refundable R&D tax offset will be set at 18.5% above the company’s tax rate and the cap on the annual cash refund of $4.0m will be scrapped.

For large companies (i.e. an aggregated turnover of $20.0m or more) the number of intensity tiers will reduce from 3 to 2.  The R&D premium ties the rate on the non-refundable R&D tax offset to a company’s incremental R&D intensity.  That is, the non-refundable R&D tax offset is tied to the percentage of R&D expenditure as a percentage against the company’s total expenses for the relevant tax year.  The marginal R&D premium will be the claimant’s company tax rate plus:

  • 8.5% above the company’s tax rate where the R&D expenditure is between 0% and 2% R&D intensity; and
  • 16.5% above the company’s tax rate where the R&D expenditure is above 2% R&D intensity

The Research & Development changes will not commence until 1 July 2021.

Expanding Access to Some Small Business Tax Concessions

By increasing the small business entity turnover threshold for certain concessions businesses with an aggregated annual turnover of $10.0m or more but less than $50.0m will have access to additional small business tax concessions in 3 phases:

  • From 1 July 2020 eligible businesses will be able to immediately deduct certain start-up expenses
  • From 1 July 2020 eligible businesses will be able to immediately deduct certain prepaid expenses
  • From 1 April 2021 eligible businesses will be exempt from FBT on car parking fringe benefits provided that the car parking fringe benefit is not being provided through a commercial car parking facility
  • From 1 April 2021 eligible businesses will be exempt from FBT on multiple work-related portable electronic devices (such as phones and laptops) provided to employees
  • From 1 July 2021 eligible businesses will be able to access the simplified trading stock rule
  • From 1 July 2021 eligible businesses will be able to remit PAYG instalments based on an adjusted notional tax basis
  • For income years commencing on 1 July 2021 eligible businesses will have a two year amendment period apply to income tax assessments (excluding entities that have significant international tax dealings or particularly complex affairs).

If you would like to discuss how the 2020 – 2021 Federal Budget may impact your business please contact our office.

Business Support Fund

Victorian Business Support Fund

September 15th, 2020 Posted by B&W Additions News, Individuals, Jobkeeper Payment, News, Pension, Retirees, Superannuation No Comment yet

Over the weekend the Victorian Government release details of another round of the Business Support Fund to assist ease the financial burden being felt by many businesses in Victoria that are being adversely impacted by the ongoing lock downs  The amount of financial support on offer is unlikely to ease much of the pain that small businesses are suffering and if you are a sole trader then this package is offering no assistance.  There is supposed to be further announcements setting out an assistance package to those sole traders so we will have to wait to see what form that assistance is likely to take.


Cash grants of between $10,000 and $20,000 depending on the business’ annual payroll.  If you are an eligible business you will receive one of the following amounts:

  • $10,000 if your annual payroll is less than $650,000
  • $15,000 if your annual payroll is between $650,000 and $3.0m
  • $20,000 if your annual payroll is between $3.0m and $10.0m

To be eligible for the above cash grants you must:

  • Operate a business located in Victoria;
  • Participate in the JobKeeper Payment scheme;
  • Employ people and be registered with WorkSafe;
  • Have had an annual payroll of less than $10.0m in the 2020 financial year;
  • Be registered for GST;
  • Hold an ABN; and 
  • Be registered with the responsible Federal or State regulator (waiting on clarification as to what this actually means)

Cash grants of up to $30,000 for licensed pubs, clubs, hotels, bars, restaurants and reception centres.  The level of the cash grant is subject to venue capacity and location.


The latest round of assistance also includes additional funding, tools and resources to assist businesses prepare for re-opening.  Under the business adaption the Victorian Government is allowing:

  • A $20.0m voucher program to assist sole traders and small businesses build their digital presence/capability
  • A $15.7m package to help Victorian exporters get their products to market and establish new trade channels
  • A $8.5m expansion to the “Click for Vic” campaign to encourage more Victorians to support local business

The Victorian Government is also offering some waivers and deferrals.  These include:

  • A deferral of payroll tax liability for the full 2020/21 financial year

[This should come with a warning that it is a deferral of payroll tax payable and not a waiver.  If your business is paying payroll tax and you are able to continue to fund the liability then we suggest that you do so as accepting a deferral can create it own cash flow problems down the track.  An increase in the payroll tax threshold from $650,000 to $1.5m would have been more beneficial for businesses as it would provide relief from a tax that is imposed on businesses employing people.  In an environment where unemployment is forecast to be greater than 10% you would think that they would put together a business support fund that encouraged businesses to employ people or at a minimum retain their current employees].

  • Bring forward the 50% Stamp Duty discount for commercial/industrial property for all of Regional Victoria.
  • Deferral of the planned increase in landfill levy for 6 months
  • 25% waiver for the Congestion Levy for this year (presumably they refer to financial year but not clear in the current release)
  • Liquor license fee to be waived for 2021
  • Waiving of the Vacant Residential Land Tax for vacancies in 2020

We will advise you of when the application process opens for the third round of cash grants.

In the meantime please do not hesitate to contact us on on 03 96291433 if you have any queries.


Victorian Business Support Fund

Extension of the JobKeeper Scheme

Extension of the JobKeeper Scheme

July 22nd, 2020 Posted by B&W Additions News, Individuals, Jobkeeper Payment, News, Pension, Retirees, Superannuation No Comment yet

The Government announced on 21 July 2020 that they will be extending the JobKeeper scheme for another six months. Payments dates for the JobKeeper scheme when originally announced were to 27th September 2020. 

Due to the continued deterioration of the economy and the community spread of COVID-19 the scheme will now run until 28 March 2021. We have outlined below some of the key points of the extended scheme as announced today.


Eligibility

To be eligible for the JobKeeper payments under the extended time frame you will need to have experienced an actual decline in turnover of:

  • 50 per cent for those with an aggregated turnover of more than $1 billion; 
  • 30 per cent for those with an aggregated turnover of $1 billion or less; or 
  • 15 per cent for Australian Charities and Not for profits Commission-registered charities 

The JobKeeper payment extension is open to both existing and new recipients as long as you meet the original eligibility requirements and the additional turnover tests during the extension period. 


Comparison Period

For JobKeeper extension dates commencing 28th September 2020 and ending 3rd January 2021 you will need to demonstrate that you have met the relevant continuing decline in turnover test in both of the following quarters:

  • June 2020 quarter v June 2019 quarter; and
  • September 2020 quarter v September 2019 quarter.

You will then need to re-assess your ongoing eligibility in January for the period commencing 4th January 2021 and ending 28th March 2021.  To be eligible for the continued JobKeeper payments you will need to demonstrate that you have met the relevant continuing decline in turnover test in all of the following quarters:

  • June 2020 quarter v June 2019 quarter; and
  • September 2020 quarter v September 2019 quarter; and
  • December 2020 quarter v December 2019 quarter.

Recipients will need to assess their eligibility in advance before finalising their Business Activity Statements in order to enrol in the extended JobKeeper scheme. To give employers time to evaluate, the Commission of Taxation will have the discretion to extend the time where employers are required to pay the JobKeeper top up in advance in order to be reimbursed by the Australian Tax Office.

The existing rules for eligible employees remain unchanged.


Payment rates

For JobKeeper extension dates commencing 28th September 2020 to 3rdJanuary 2021 the payment rate are as follows:

  • $1,200 per fortnight for all eligible employees who, in the four weeks before 1 March 2020, were working in the business or not-for-profit for 20 hours or more a week on average, and for eligible business participants who were actively engaged in the business for 20 hours or more per week on average in the month of February 2020
  • $750 per fortnight for other eligible employees and business participants.

For JobKeeper extension dates commencing 4th January 2021 to 28th March 2021 the payment rate are as follows:

  • $1,000 per fortnight for all eligible employees who, in the four weeks before 1 March 2020, were working in the business or not-for-profit for 20 hours or more a week on average and for business participants who were actively engaged in the business for 20 hours or more per week on average in the month of February 2020
  • $650 per fortnight for other eligible employees and business participants.

For further information, visit the Australian Government Treasury Website fact sheet

Should you have any queries regarding the JobKeeper Scheme, please do not hesitate to contact either our office on 03 96291433 to discuss.

2020 Tax Planning Businesses

2020 Tax Planning Businesses

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2020 Tax Planning Individuals

2020 Tax Planning – Individuals

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Retail and Commercial Tenancies

Retail and Commercial Tenancies

May 7th, 2020 Posted by B&W Additions News, News, Retail and Commercial Tenancies No Comment yet

The Victorian Government has released the regulations that govern the relationship between commercial landlords and their tenants (being small to medium sized businesses with an annual turnover of up to $50m and eligible for the JobKeeper Payments) commencing with effect from 29 March 2020 and ending on 29 September 2020[…]

Things to know about the Jobkeeper Scheme

Things to know about the JobKeeper Scheme

April 27th, 2020 Posted by B&W Additions News, Individuals, Jobkeeper Payment, News, Pension, Retirees, Superannuation No Comment yet

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jobkeeper scheme - Alternative Decline in Turnover Tests

JobKeeper Scheme – Alternative Decline in Turnover Tests

April 27th, 2020 Posted by B&W Additions News, Employers, Individuals, Jobkeeper Payment, News No Comment yet

One of the main eligibility rules to become an eligible employer under the JobKeeper scheme is to be able to demonstrate that the businesses turnover has declined by more than 30% (where the business’ aggregate turnover was less than $1.0b) to a comparable period[…]