From JobKeeper to JobMaker
Supporting Australian small business to create jobs.
With JobKeeper 2.0 now in place and on the countdown to end in March 2021, the Treasury announced a new initiative in the 2020/21 Federal Budget…. JobMaker!
Rules for the hiring credit scheme outline eligibility criteria and the ineligibility of sole traders. The program has been designed to assist 450,000 young people back to work. $4 billion has been allocated to businesses who hire eligible employees between now and 6 October 2022, with payments effective for 12 months after the hire date. Effectively requiring funding until October 2023.
JobMaker payments will be paid in what has been labelled ‘JobMaker Periods’ – three-month blocks over a 12 month period.
Entitlement for the JobMaker hiring credit payment will depend on if the entity notifying the commissioner of its election to participate:
- uses the approved form
- does so by the end of the period that the entity first elects to participate.
In practice, that means an entity who elects to participate for the JobMaker period of 7 October 2020 to 6 January 2021, notifies the commissioner by 6 January 2021.
As with previous schemes, if an employer is entitled to receive a JobKeeper payment, they are unable to participate in JobMaker, unless JobKeeper participation has ceased.
JobMaker rules allow prohibition on JobKeeper fortnights that begin during a JobMaker period. Allowing an entity to have a single JobKeeper fortnight end at the start of JobMaker period.
This overlap will allow an entity to cease JobKeeper participation, and begin the JobMaker scheme without requiring a gap.
The following rules apply for entities to participate in JobMaker:
- Continue conducting business in Australia or pursue objectives as a non-profit body principally in Australia or be a certain public fund.
- Have an ABN.
- Be registered as a withholder in accordance with the Taxation Administration Act 1953
- Not have any outstanding income tax or GST returns due in the past two years.
- Have at least one employee who is not entitled to the JobMaker hiring credit (an entity may not be a sole trader and employ themselves).
The JobMaker scheme will allow entities who qualify to receive payments for eligible additional employees.
Additional employees must:
- Be aged between 16 and 35.
- Commence employment between 7 October 2020 and 6 October 2021.
- Work a minimum of 20 hours per week.
- Have received the JobSeeker payment, Youth Allowance (other) or parenting Payment for at least 28 of the 84 days before commencement of employment.
More information on the scheme can be found here.
Is your business eligible for JobKeeper? Click here to find out.
Government Stimulus in a COVID world is complex. If you need help to navigate the JobKeeper and JobMaker maze, or if you would like a second opinion to help you get back on track, contact us on 1300 888 803. We are here to help Australian small business owners during these difficult time.
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