JobKeeper Payment – Calculating fall in turnover for Eligible employers

Employers will be eligible for the JobKeeper payment if all of the following apply:

• On 1 March 2020, you carried on a business in Australia or were a not-for-profit organisation that pursued your objectives principally in Australia.
• You employed at least one eligible employee on 1 March 2020.
• Your eligible employees are currently employed by your business for the fortnights you claim for (including those who are stood down or re-hired).
• Your business has faced a
  • 30% fall in turnover (for an aggregated turnover of $1 billion or less)
  • 50% fall in turnover (for an aggregated turnover of more than $1 billion), or
  • 15% fall in turnover (for ACNC-registered charities other than universities and schools).

You only need to satisfy this requirement once – you do not need to retest turnover each month.

At the time you enrol in the JobKeeper payment scheme, you need to confirm that your business in a relevant period has had, or is likely to have, a:

• 30% fall in turnover (for an aggregated turnover of $1 billion or less)
• 50% fall in turnover (for an aggregated turnover of more than $1 billion), or
• 15% fall in turnover (for ACNC-registered charities other than universities and schools).

To work out your fall in turnover, you can compare either:

• GST turnover for March 2020 with GST turnover for March 2019
• projected GST turnover for April 2020 with GST turnover for April 2019
• projected GST turnover for the quarter starting April 2020 with GST turnover for the quarter starting April 2019.

How you choose to project your fall in turnover is not dependent on whether you report a quarterly or monthly BAS, though you can do that if it is easier.

The turnover calculation is based on GST turnover, but there are some modifications, including disregarding GST grouping (where two or more associated business entities operate as a single GST group). ATO will provide more information soon about applying the turnover test.

If you work out that you qualify for the JobKeeper payments for the first fortnight because your turnover has declined by the relevant amount, you remain eligible and do not need to keep testing turnover in following months. However, you will have ongoing monthly reporting requirements. More information will be provided soon by ATO.

The Commissioner of Taxation also has the discretion to set out alternative tests that can establish your eligibility when turnover periods are not appropriately comparable (for example, if your business has been in operation less than a year). ATO will provide more information soon about alternative tests.

Contact Expert Tax on 0449 952 855 or 1300 869 829 for further assistance.