The NSW Government has recently announced their latest round of COVID Business Support packages targeting business, workers and the performing arts with applications open from mid-February. Summarised below are the key items and details from the announcement:

2022 Small Business Support Program

Eligible business will receive 20% of weekly payroll with a minimum as a lump sum for the month of February, with a minimum payment of $750 per week and a maximum payment of $5,000 per week. Non-employing businesses won’t miss out either receiving $500 per week in the form of a $2,000 lump sum payment.

Eligibility for the grant is summarised as per below with applications open mid February:

• had an aggregated annual turnover of between $75,000 and $50 million (inclusive) for the year ended 30 June 2021; and
• experienced a decline in turnover of 40 per cent or more due to Public Health Orders or the impacts of the Omicron COVID-19 strain during the month of January 2022, compared to January 2021 or January 2020; and
• experienced a decline in turnover of 40 per cent or more due to the impacts of the Omicron COVID-19 strain from 1-14 February 2022, compared to the same fortnight in February in the comparison year used for the above criterion; and
• maintain their employee headcount from the date of the announcement of the scheme.

Small Business Fees, Charges and RAT Rebate

The existing RAT rebate has been increased to $3000 with employing small businesses being able to use the rebate to cover half the cost of the Rapid Antigen Tests (RATs). Note, these funds can be used to offset other government fees and charges such as licences, event fees, council rates and road tolls. If you are already registered, no need to worry as you will receive an automatic top-up to $3000.

Commercial Landlord Hardship Grant

The existing protections for small retail and commercial tenants will be extended under the Retail and Other Commercial Leases (COVID-19) Regulation 2021 until 13 March 2022. To assist eligible landlords, grants of $3,000 (GST inclusive) per property are available for each month that they provided rental relief waivers to tenants. Please be aware that rent relief waived must comprise at least half of the amount granted to the landlord.

Landlords who have claimed the 2021 land tax relief are also included in the Commercial Landlord Hardship Grant program. Note, landlords under the above regulation are unable to evict or lockout their tenants until they have attempted mediation or renegotiation of rent if the tenants are eligible.

Performing Arts Package

The NSW Government is looking to provide additional financial support for the performing arts sector. To gain access to government supported funding applicants must be one of the following:

• An eligible venue (list published by Create NSW)
• A producer of an eligible performance scheduled to perform at one of the eligible venues
• A promoter of an eligible performance scheduled to perform at one of the eligible venues.

The NSW Government has also provided clarification over what defines each applicant:

Eligible Venue: List created and maintained by Create NSW from their own assessment

Eligible Performance: Requires evidence of the performance through marketing, and ticket sales must be managed through a ticketing system listed by Create NSW.

Once eligibility is determined funding will be provided between 19 September 2021 and 20 April 2022. The total funding is calculated as per below:

Funding = Average Ticket Price x Number of Tickets on Sale x Agreed Percentage.

The agreed percentage is determined by the below table, and with different venues receiving different funding amounts.

Note, NSW Government will cap funding at 10,000 tickets (e.g. no funding for the 10,001 tickets).

If you’d like further support to explore the NSW COVID business support packages on offer, don’t hesitate to contact a member of the MGI SQ team.

The 2021 COVID-19 Business Support Grant for lockdown-impacted businesses in Queensland is now open to applications (except in relation to the $1,000 grant for non-employee sole traders).  While it was originally announced as a $5,000 grant, the grant support has been increased.  Below is a summary of the grant amounts and eligibility conditions.

The 30% turnover (i.e. income) decline is based on a nominated 7-day period with comparing to the same 7-day period from 2 years ago (or an alternative 7-day period if that isn’t situatable).  The nominated 7-day period must include one full day of the lockdown periods in July & August 2021. Your business doesn’t necessarily need to have been in one of the lockdown zones, it just needs to show it is in Queensland and it had the 30% decline in the nominated period.

The application for the grant is online only and must be completed by the business and not their advisers.  As part of the application, evidence is required from various records from your bookkeeping records (e.g. BAS, payroll reports, BASs, income reports). Alternatively, a letter can be provided by your accountant instead to advise these details instead or we can assist with getting the records from your bookkeeping records.

Importantly, it has been announced that funds will be provided to all successful applicants, so the grant isn’t limited to a certain cap.  Once a grant application is successful approved, the funding will be paid within 2 weeks of the approval.

The non-employing sole trader grant of $1,000 is not currently open for applications but you can currently register your interest to receive updates from the Queensland Government.  If you are sole trader but have employees, you should consider the small, medium or large grants instead.

For further information, please contact MGI or see the details on Queensland Government website below.

https://www.business.qld.gov.au/starting-business/advice-support/grants/covid19-support-grants

This morning the Queensland Government introduced a $260 million grant for small to medium businesses who have been affected by the two recent lockdowns.

Eligible businesses will receive $5,000 (excluding GST) to use for any business expenses and to support cash flow through the Covid Lockdown. Your business does not have to be located in South East Queensland to be eligible for the grant.

Eligibility

To be eligible for the grant, your business must have experienced a reduction in turnover of at least 30% as a result of the lockdown.

Small & Medium Businesses are defined as having:

• A turnover of more than $75,000 per annum
• An annual payroll in Queensland of up to $10 million

Applying for the Grant

You will need to apply online with supporting evidence. The funds will be paid into your bank account within 2 weeks of the application being processed and approved.

More specific information about the grant including opening date will be available within the coming days.

If you need assistance regarding your grant application, please do not hesitate to contact our Team.

You can now register for the JobMaker scheme as announced in the Federal Budget back in October.

(Please note that the following are based on draft Rules as announced by the Treasurer)

Please note that according to the draft Rules, if you would like to claim JobMaker for the first period (7 October 2020 – 6 January 2021), you must register on or before 6 January 2021.

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What is JobMaker?

JobMaker is a new scheme aimed at supporting employers to employ additional people in their businesses, specifically those aged between 16 and 35 years of age. Employers will get reimbursed for each new employee they hire over the period of 7 October 2020 until 6 October 2021. The hiring credit is then available for another 12 months for each of those new jobs (meaning the scheme is set to come to an end on October 6, 2022).

Employers will receive:

• $200 per week for each eligible employee aged between 16 and 29 years of age
• $100 per week for each eligible employee between 30 and 35 years of age

The credit will be capped at the value of the increase in the total payroll for the JobMaker Period over and above the baseline payroll amount (more on this later).

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Am I Eligible?

As an employer, you are eligible to claim the JobMaker you can answer YES to all of the following:

• You are registered for ABN and PAYG Withholding during the relevant JobMaker Period (more on the JobMaker Periods later).
• You are not entitled to receive any JobKeeper payments for the employee during the relevant JobMaker Period.
• You are not a major bank, government agency or entity in liquidation/bankruptcy.
• As at each claim date, your tax and BAS lodgements are up to date.
• You have employed at least one additional employee on or after 7 October 2020, and the additional employee is aged between 16 and 35 years of age on the date of commencing employment. Also, for a period of 28 consecutive days within the 84 days immediately before the commencement of employment with you, the additional employee received either:
  • Parenting Payment;
  • Youth Allowance; or
  • Jobseeker Payment.
• Each additional employee must give you a completed JobMaker Hiring Credit Employee Notice, confirming eligibility.
• You had an increase in employee headcount, meaning the number of employees employed by you at the end of each JobMaker Period is higher than the number of employees in your baseline headcount. Your baseline headcount is your headcount on 30 September 2020 for the first year of JobMaker. All employees are included in the headcount, including full-time, part-time, casual, fixed-term and non-fixed-term employees. However, it excludes contractors.
• The additional employee’s average hours of work (including paid absences) across the JobMaker Period is equal to or greater than 20 per week.
• The additional employee is not a related party (e.g. a trustee, beneficiary, shareholder or director of the employing entity, or a relative of these parties).
• In the six months immediately before 6 October 2020, the additional employee was not engaged otherwise by you to perform substantially similar duties (e.g. as an independent contractor).
• Please note that eligibility for each JobMaker Period is assessed independently. This means you can become eligible at any point during the program.

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JobMaker Periods & Claim Periods

The program has eight quarterly JobMaker Periods, each with a corresponding Claim Period. The Claim Period is the time within which you must submit a form to the ATO through its online services (e.g. the Business Portal or the Tax Agent Portal) in order to receive the JobMaker for the relevant period.

The JobMaker Periods and related Claim Periods are as follows:

How do I register?

Before you can make a claim for JobMaker, you must first register your intent to claim with the ATO through the ATO’s online services (e.g. the Business Portal or the Tax Agent Portal). This registration must be completed before the end of your first applicable Claim Period. This means if you intend to claim JobMaker for the first JobMaker Period (7 October 2020 – 6 January 2021), you must register on or before 6 January 2021.

In the registration, you will need to declare:

• The total number of employees employed as at 30 September 2020 (the “baseline headcount”);
• The total payroll for the quarter up to 6 October 2020 (the “baseline payroll amount”).

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How do I claim?

For each JobMaker Period, an online form needs to be lodged with the ATO before the end of the corresponding Claim Period.

As part of this form, the following information will need to be declared:

• The baseline payroll amount, if it changes from the amount declared as part of the initial registration;
• The total payroll amount for the relevant JobMaker Period;
• The total number of employees employed at the end of the JobMaker period.

The online form will rely upon information submitted to the ATO via Single Touch Payroll (STP), including the dates on which eligible employees commenced and/or ceased employment. It is therefore important that you ensure that your outstanding STP filings are lodged with the ATO at least 3 days before the end of each Claim Period, as it can take up to 3 days for these to be processed.

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What happens after this?

Once the online form is submitted, the ATO will calculate and pay JobMaker to you. The amount of the credit depends on the number of additional employees throughout the relevant JobMaker Period compared to the baseline headcount, along with the ages of the additional employees ($200 per week for employees aged 16-29 year and $100 per week for employees aged 30-35). However, the credit will be capped at the value of the increase in the total payroll for the JobMaker Period over and above the baseline payroll amount. Please contact us if you would like to know how this cap may affect your claim.

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What Do I Do Next?

The first step is to assess your eligibility to claim JobMaker in the first JobMaker Period.

The team at MGI South Queensland is available to assist you to assess your eligibility and navigate the complexity of the scheme. We are also able to assist you with lodgement of the registration form and quarterly claims.

If you need assistance understanding or actioning this new program, do not hesitate to contact us.

The alternative decline in turnover test for JobKeeper fortnights from 28 September onwards has been released by the ATO.

The new alternative tests are in line with the original covering the 7 circumstances outside the usual business operation that resulted in your 2019 relevant comparison period not being appropriate for applying the basic decline in turnover test.

This includes the following:

1. Business that started after the comparison period
2. Business acquisition or disposal that changed the entity’s turnover
3. Business restructure that changed the entity’s turnover
4. Business that has had a substantial increase in turnover
5. Business affected by drought or natural disaster
6. Business that has an irregular turnover
7. Sole trader or small partnership with sickness, injury or leave

Below are some of the key changes that you should take into consideration when applying the appropriate tests

• The alternative test is now based on the actual GST turnover rather than projected GST turnover, which is in line with the basic decline in turnover test for the JobKeeper extension from 28 September.
• Turnover comparison method
  • For entities that are registered for GST, the method used for calculating the turnover will need to be in line with their GST registration (i.e. cash or accruals)
  • For entities that are not registered for GST, the entity can elect the method used for calculating the turnover; however, a consistent approach will need to be taken.
• Entities that experienced a substantial increase in their current GST turnover will now be able to choose between using the period immediately before the turnover test period or before 1 March 2020.
• Similarly, with the irregular turnover test, a choice is now available using the period immediately before the applicable turnover test period or before 1 March 2020.
• The new alternative test removes the requirement for entities with multiple acquisitions, disposals and restructures to use the period after the last of the sequential transactions.  The changes allow an entity that has had multiple acquisitions, disposals or a sequence of restructure transactions at or after the start of the relevant comparison period but before the applicable turnover test period to apply these tests to each acquisition, disposal or restructure separately.
• The test for sole traders or partnerships affected by not working for all or part of that period due to sickness, injury or leave can apply the current GST turnover for the month immediately before the month in which the sole trader or partner did not work, rather than the turnover for the month immediately after the month in which they returned to work.

As with the previous alternative test or the basic decline in turnover tests, you will need to maintain sufficient and appropriate documentation on how the tests have been applied in case of an ATO review.

Please feel free to contact the team at MGI South Queensland if you wish you to discuss the application of the alternative test to your circumstances.

Following the recent passing of legislation to extend JobKeeper, Treasury has provided further detail surrounding eligibility and payment details.

Am I eligible?

To be eligible for the Jobkeeper extension under the basic test your business must have experienced an actual decline in turnover of:

• 50% for those with aggregated turnover of more than $1 billon.
• 30% for those with an aggregated turnover of $1 billon or less
• 15% for Australian Charities and Not for Profits Commission-registered charities (excluding schools and universities)

In some situations, your business may still be eligible under an alternative test depending on your circumstances. The details of the alternative tests are being finalised by the Tax office. Please contact us if you wish to discuss.

What is the turnover period?

Businesses will satisfy the actual decline in turnover test if your current GST turnover for quarter ending 30 September 2020 has declined in comparison to the same prior-year period (30 September 2019). If you satisfy the turnover test, you are eligible to continue JobKeeper until 3 January 2021.

In order to get a further extension of JobKeeper until 28 March 2021 – your business will have to re-test and demonstrate an actual decline in GST turnover for quarter ending 31 December 2020 compared with the same prior year period (31 December 2019).

Changes to employee eligibility

As of the 3rd August 2020, the key date for assessing employee eligibility is now 1 July 2020. This will capture employees who may have started in your business between 1 March 2020 and 1 July 2020.

Employees that were eligible as at 1 March 2020, will continue to be eligible going forward.

Changes to Jobkeeper payment rates

From the 28 September 2020, there will be two payment rates – a tier 1 and tier 2 rate – which will be stepped down in two stages, see below.

An employee’s entitlement to Tier 1 or Tier 2 payments is based on whether they meet the 80-hour threshold.

An employee or business participant/religious practitioners is entitled to the Tier 1 rate if the 80-hour threshold is satisfied. If they do not meet this threshold they are eligible for Tier 2 payment rate.

80-Hour Threshold

There are two steps to satisfying the 80-hour threshold:

1.      Determine the individuals reference period

For eligible employees – 28 days finishing on the last day of the last pay period that ended before either 1 March 2020 and 1 July 2020. If the employee was working during both 28-day periods you will need to consider both reference periods.

If you are looking to qualify as a Business Participant, the reference period is the month of February 2020.

In some circumstances, an alternative reference period can apply if the standard period (above) is not suitable.

There may be more than one reference period that applies to an individual – if the employee satisfies the 80-hour threshold in any reference period then Tier 1 applies

2.      Apply the 80-hour test

Generally, a full-time employee who has been employed for their full 28 day reference period will satisfy the 80-hour threshold.

Further consideration is required for employees that are part-time, long-term casual, not paid on an hourly basis or stood down

28-day reference period

The 28-day reference period or periods are based on when the pay cycle ends and therefore won’t be the same for all employers.

Use either:

• the pre-March period which is the 28 days which finish on the last day of the last pay cycle that ended before 1 March 2020, or
• the pre-July period which is the 28 days which finish on the last day of the last pay cycle that ended before 1 July 2020.

Your pay cycle for an employee may not be the same as the period between the days you actually pay them. For example, the amount you pay an employee each Friday may be for the hours worked in a week ended on the previous Wednesday – in this case the pay cycle is the week ended on the Wednesday.

If your pay cycle is longer than 28-days (for example monthly), a pro-rata calculation will need to be performed.

Example – determining the reference period:

Callum runs a business and has 10 employees.

The business has a fortnightly pay cycle, which ends every second Wednesday.

In February 2020, the pay cycle for Callum’s business ended on the 5th and the 19th.

The pre-March period of Callum’s employees is the 28 consecutive days ended on the 19 February (being the 23 January to the 19th January).

In June 2020, the pay cycles for Callum’s business ended on the 10th and 24th.

The pre-July period for Callum’s employees is the 28 consecutive days ended on the 24th June. The reference period is the 28th to May to 24th June

If any of his employees do not meet the 80-hour threshold for the pre-March and pre-July periods he should consider applying an alternative reference period.

Please contact us should you wish to apply an alternative reference period.

What doesn’t change?

You do not have to re-enrol for the extension if you are already enrolled prior to 28 September.

You do not need to re-assess employee eligibility if you are already claiming for them before 28 September.

You do not need to meet any further requirements if you are claiming for an eligible business participant.

Notifying the ATO

From the 28th September, you will need to notify the ATO of the following:

• Actual GST turnover reduction
• Which Tier will apply for all eligible employees/business participants/religious practitioners

We expect that the identification process will be a declaration via the Business portal or lodgement through a tax agent

Within 7 days of notifying the ATO of the Tier rate, you must also notify each individual employee in writing of their rate.

Further Information

Please contact the team at MGI South Queensland if you wish to discuss your personal circumstances.

The Government has announced the extension of the JobKeeper Payment until 28 March 2021 and is targeting support to those businesses that continue to be significantly impacted by the Coronavirus.

From 28 September 2020, eligibility for the JobKeeper Payment will be based on actual turnover in the relevant periods and the payment will be stepped down and paid at two rates.

How can you be Eligible?

To be eligible for JobKeeper Payments under the extension, businesses and not-for-profits will still need to demonstrate that they have experienced a 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 (excluding schools and universities).

Periods of Turnover Testing

In order to be eligible for the JobKeeper Payment from 28 September 2020, businesses will have to meet a further decline in turnover test for each of the two periods of extension, as well as meeting the other existing eligibility requirements for the JobKeeper Payment.

To be eligible for Jobkeeper payment from 28 September 2020 to 3 January 2021

Businesses will need to demonstrate that their actual GST turnover has fallen in the September quarter 2020 (July, August, September) relative to a comparable period (generally the corresponding quarter in 2019).

To be eligible for the second JobKeeper Payment extension period of 4 January 2021 to 28 March 2021

Businesses and not-for-profits will need to demonstrate that their actual GST turnover has fallen in the December quarter 2020 (October, November, December) relative to a comparable period (generally the corresponding quarters in 2019)

The Commissioner of Taxation will have the discretion to set out alternative tests that would establish eligibility in specific circumstances where it is not appropriate to compare actual turnover in a quarter in 2020 with actual turnover in a quarter in 2019

The JobKeeper Payment rate

From 28 September 2020 to 3 January 2021, the JobKeeper Payment rates will be:

• $1,200 per fortnight for all eligible employees who were working for 20 hours or more a week on average in the four weeks of pay periods before either 1 March 2020 or 1 July 2020, and for eligible business participants who were actively engaged in the business for 20 hours or more per week on average; and
•  $750 per fortnight for other eligible employees and business participants.

From 4 January 2021 to 28 March 2021, the JobKeeper Payment rates will be:

• $1,000 per fortnight for all eligible employees who were working for 20 hours or more a week on average in the four weeks of pay periods before either 1 March 2020 or 1 July 2020, and for business participants who were actively engaged in the business for 20 hours or more per week on average; and
• $650 per fortnight for other eligible employees and business participants.

Who are eligible Employees

Employees are eligible in the extension period if they:

• are currently employed by an eligible employer (including if you were stood down or rehired)
• were for the eligible employer (or another entity in their wholly-owned group) either:
  • a full-time, part-time or fixed-term employee at 1 July 2020; or
  • a long-term casual employee (employed on a regular and systematic basis for at least 12 months) as at 1 July 2020 and not a permanent employee of any other employer.
• were aged 18 years or older at 1 July 2020 (if you were 16 or 17 you can also qualify if you are independent or not undertaking full time study).

Were either:

• an Australian resident (within the meaning of the Social Security Act 1991); or
• an Australian resident for the purpose of the Income Tax Assessment Act 1936 and the holder of a Subclass 444 (Special Category) visa as at 1 March 2020.
• were not in receipt of any of these payments during the JobKeeper fortnight:
  • government parental leave or Dad and partner pay under the Paid Parental Leave Act 2010; or
  • a payment in accordance with Australian worker compensation law for an individual’s total incapacity for work.

Only one employer can claim the JobKeeper Payment in respect of an employee

The self-employed will be eligible to receive the JobKeeper Payment where they meet the relevant turnover test, and are not a permanent employee of another employer. Employees will continue to receive the JobKeeper Payment through their employer during the period of the extension if they and their employer are eligible and their employer is claiming the JobKeeper Payment. However, the amount of the JobKeeper Payment will change at the rates set out above.

Further Information

Please contact our office if you wish to discuss your personal circumstances and how to meet the eligibility criteria.

The government has announced that the current $1,500 per fortnight JobKeeper payment will continue past 27 September. However, it will be reduced to $1,200 per fortnight from 28 September, and $750 per fortnight for employees working less than 20 hours a week.

From 4 January, the rate will fall to $1,000 per fortnight and $650 for people working less than 20 hours a week.

Full details of the updated JobKeeper program can be found here.

New Eligibility Tests

Businesses looking to remain on JobKeeper beyond 27 September will be required to meet new eligibility tests.

Businesses will still be required to demonstrate the required reduction in turnover i.e. 30 per cent for businesses with turnovers of $1 billion or less, 50 per cent for those with turnover of more than $1 billion, and 15 per cent for ACNC-registered charities.

The current JobKeeper programs requires a business to apply the test for one period (a month or a quarter) prospectively. However, the government will now require businesses to reapply the tests for the June and September quarters to be eligible for JobKeeper beyond September.

In addition, businesses will need to demonstrate that they have met the relevant decline in each of the three quarters ending on 31 December 2020 (June, September and December quarters) to remain eligible for the payment from January 2021 to March 2021.

We will continue to update this post once more details are known.

Please contact your MGI South Queensland advisor should you have any queries.

The Queensland Government has announced that the Small Businesses COVID-19 Adaption Grants program has been extended. This will provide an additional $100 million in grants of up to $10,000 for small businesses and these will be made available from July 1. Successful applicants from round 1 of this program cannot apply for funding under round 2.

What will and won’t be funded

Click here to find out if you are eligible. Read the frequently asked questions here.

Applications will open July 1 and please contact your MGI South Queensland Advisor should you have any queries on this.