Legislation to establish the framework for providing financial support to businesses and employees, through wage subsidies such as the JobKeeper Payments, has passed Parliament and received assent.


  • JobKeeper payments are payable to qualifying employers for a maximum of 13 fortnights in respect of each eligible employee on their books on 1 March 2020 who is retained by the employer.
  • Qualifying employers will receive a payment of $1500 per fortnight for each eligible employee.
  • JobKeeper scheme commenced on 30 March 2020 and ends on 27 September 2020. (six month period).
  • The Bill also allows for a period up to the 31 December 2020. At the time of writing, the Legislative Instrument has not been released and may be different in its final form.
  • If an entity’s aggregated turnover for the income year is likely to exceed $1 billion or exceeds $1 billion for the previous income year, then a 50 per cent decline in turnover is required to be eligible for JobKeeper payments.
  • For ACNC-registered charities, the threshold is 15 percent while it is 30 per cent for all other entities, including sole traders.
  • The business’s GST turnover, with some modifications, will be used to calculate the actual drop in turnover percentage. The turnover test period must be:
  • a calendar month that ends after 30 March 2020 and before 1 October 2020; or
  • a quarter that starts on 1 April 2020 or 1 July 2020; and
  • the relevant comparison period must be the period in 2019 that corresponds to the turnover test period.

The Tax Commissioner will have the discretion to determine that a business qualifies for the payments, even if for some reason the business is unable to satisfy the stipulated criteria of reduced turnover.

The ATO can consider additional factors put forward to demonstrate a business has been impacted such as where the business was not operating a year before, or if the previous year’s turnover was not representative of its usual turnover.

Alternative tests to satisfy the criteria in certain circumstances may also be provided by the Commissioner, for example, if a business has ceased or its operations have significantly reduced.

As the applications will require employers to make an estimate about expected fall in turnover, Treasury has advised there will be some tolerance if the actual fall is slightly smaller than that estimated by the employer. 


Access to JobKeeper for nominated eligible business participant

JobKeeper also addresses the lack of access to the Cash Flow Boost by business owners operating as sole traders or through partnerships, companies or trusts and not drawing wages. The Rule provides for payments to sole traders as long as they do not receive JobKeeper from another source, as well as the ability to nominate a single individual beneficiary of a trust, a single partner in a partnership, or a single director or shareholder of a company to receive JobKeeper, subject to the eligible business participant test. These businesses will also receive JobKeeper payments for their eligible employees.

There are similar eligibility requirements to the Cash Flow Boost, such as having an ABN at the 12 March 2020 and reporting taxable supplies or business income before 12 March 2020 or a later date allowed by the Tax Commissioner.

Nomination and notification

The employer must notify the Tax Commissioner that they have elected to participate in the JobKeeper scheme by the end of the second JobKeeper fortnight for an entitlement arising in the first or second JobKeeper fortnight, or by the end of the fortnight for an entitlement arising in any other fortnight.

The employer must also notify an eligible employee or eligible business participant in writing within seven days of notifying the Tax Commissioner of their details. Such an individual must agree to be nominated by the employer or business.

Further, an employer cannot be entitled to a JobKeeper payment for an individual if another entity is entitled to a JobKeeper payment for the individual.

Payments to eligible employees or eligible business participants should be made via payroll systems and reported to the ATO via Single Touch Payroll. This will support the online claim process when it is available. If Single Touch Payroll reporting is not yet in place, JobKeeper payments will be claimed through a manual process.

Payments and reporting

The Tax Commissioner will pay the JobKeeper payment 14 days after either the end of the calendar month in which the fortnight ends (that is, monthly in arrears) or when the Tax Commissioner is satisfied the entity is entitled.


An entity that has qualified for the JobKeeper scheme must notify the Tax Commissioner within seven days of the end of a calendar month (the reporting month) if the entity is entitled to a JobKeeper payment for a fortnight that ends in the month, by reporting:

  • the entity’s current GST turnover for the reporting month
  • the entity’s projected GST turnover for the following month.


PAYG withholding and superannuation

Payments made to employees are taxable and PAYG amounts should be withheld. Where an employee is paid more than $1500 per fortnight, the employer’s superannuation obligations will not change. It will be up to the employer if they want to pay superannuation on any additional wages paid by the JobKeeper Payment.


Record-keeping obligations

Records must be kept substantiating eligibility and payment claims. Failure to do so will disentitle the entity from receiving payments, and the ATO will be able to claw-back payments already made. The ATO has been given the power to issue guidance about the form and contents of records that must be kept.


Other considerations

On the practical front, payroll systems and accounting records may need modification, and businesses will also need to understand the interaction of JobKeeper with state payroll taxes and changes to the Fair Work Act. There will also be a series of administrative issues such as payment mechanisms (including application against existing tax debts), notification processes, record-keeping and reporting requirements.

The significant discretion given to the Tax Commissioner will also give rise to many applications, requiring clear ATO decision-making guidelines and a streamlined appeals process. On top of the manual claims process for non-STP reporters, compliance activities and increases in calls from agents and taxpayers, there will be a significant burden on ATO resources.

Further information

  • Treasury COVID-19 site
  • ATO COVID-19 site

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