Bluebird News

We hope everyone is staying safe and staying home where possible. Change is coming thick and fast at the moment and life feels very different to the way it did a month ago, heck even a week ago!

We're all trying to get our heads around the changes that keep being handed down by the government. Some of these restrict our lives even more and some provide a little financial certainty to help us re-budget and get through the next six months.

The rainy day has already arrived for some and for others it's on its way, so today we will be exploring the most recent government announcements that may bring some sunshine to your rainy day.

Let’s discuss what has been announced so far, and how it may assist you.

JobSeeker Payment

For those of you who have lost your job, have had hours reduced and need additional income support, the JobSeeker payment may be for you. Previously, one of the eligibility criteria was that your family income needed to be under $48,000 per year. This means your partner could earn up to $1,846 per fortnight.

The eligibility criteria has been expanded and your family income can now be up to $79,762. This means your partner can now earn up to $3,067 per fortnight. Remember, even if you qualify for $1.00 of the jobseeker payment you'll qualify for the $550 Coronavirus supplement.

Whilst the above payment is handy if you are completely out of work, the government has also considered those who've been laid off due to forced closures and trading restrictions. It has also identified the businesses needing assistance to keep employees so they can recommence their businesses when this is all over and not need to use resources on rehiring employees.

In order to help businesses and employees, the next measure has been introduced.

JobKeeper Payment

Businesses that are having their rainy day due to the Coronavirus can access additional support in the form of a wage subsidy. This will help them keep their employees. It includes employees who are working and employees that can no longer work due to trading conditions and restrictions.

The wage subsidy is a flat rate of $1,500 per employee per fortnight, for up to six months. 

Eligibility

Every business owner is wondering if they're eligible. We have some good news for self-employed sole traders - this one extends to you!

The applicable key criteria for our small and medium business clients:

• you run a business that employs
• you are a self-employed sole trader
• your business turnover is less than $1 billion
• your turnover will be reduced by more than 30% relative to a comparable period a year ago for at least 1 month. 

Don’t worry if you're unsure about your turnover, the Bluebird Team will be assisting you every step of the way through this process.

What are businesses eligible for?

Businesses that are eligible will received a payment of $1,500 per eligible employee, payments will commence in the first week of May 2020 and will be backdated to those affected business who continued to pay eligible employees to the 30th March 2020.

Who is an eligible employee?

For an employee to be eligible for the payment, they must be:

• currently employed by the eligible employer (including if you have been stood down or re-hired)
• employed by the employer as of 1 March 2020
• a full time, part-time OR long-term casual employee (must have been employed on a regular basis for the previous 12 months as at 1st March 2020)
• be at least 16 years of age
• be an Australian citizen  OR Holder of a permeant visa, protected special category visa holder, a non-protected special category visa holder who has been residing in Australia for 10 or more years, Special category (subclass 444) visa holder.
• not receiving the JobKeeper payment from another business.

 TIP: The good news is If you have already put measures in place and stood down employees who were on your books as at 1st March 2020, you can re-engage these employees and be eligible for these payments. 

The process

Our team will be working closely with eligible employers. To get you set up it will involve:

• an application with the ATO
• providing supporting information demonstrating the downturn in your business
• reporting the number of eligible employees on a monthly basis
• additional monthly reporting to the ATO of your business turnover reduction   

What’s next?

If your business meets the requirements, payment will be made to the eligible business. You must notify all eligible employees that you are receiving the payment on their behalf.

The ATO will make payments monthly to the business in arrears commencing May 2020.

Then businesses will make payment to the eligible employee. The payment can be made in a few different ways:

• If your employee usually receives $1,500 or more per fortnight before tax, the business will continue to pay your regular income (top-up) based on the current workplace agreements. The JobKeeper payment will therefore subsidise part of that income.
• If your employee usually received less than $1,500 per fortnight before tax, you must pay the minimum of $1,500 per fortnight before tax.

For non-working employees:

• If you have stood down the employee you must pay a minimum of $1,500 per fortnight before tax.
• If you terminated an employee after 1 March 2020 and subsequently re-engaged the employee, you must pay a minimum of $1,500 per fortnight before tax.

 Additionally, the employer must make the 9.5% superannuation guarantee payment on amounts paid to eligible employees.

TIP: It's up to the employer’s discretion if they want to pay superannuation on any additional wage paid because of the JobKeeker Payment. What we don’t know if this extends to non-working employees – watch this space.

For example, a part-time employee earns $1,200 per fortnight, however, the business is in receipt of $1500 JobKeeper for the employee. Therefore, the employee is paid $1,500 per fortnight, the business can choose to pay $114.00 ($1,200 x 9.5%) opposed to $145.50 ($1,500 x 9.5%).

For employees

If you're an employee your employer will be determining their eligibility at this stage.

You may then receive a notification from your employer that they are receiving the JobKeeper payment. This means if you've been stood down, your employer may contact you to advise of eligibility, so if you've started to apply for JobSeeker payment you may want to reassess your position.

 In most cases you don’t need to do anything and your employer will do all the work.

 Some situations may mean you have an additional obligation, this includes:

• where you have multiple employers you must notify them who is your primary employer and who isn't
• if you're not an Australian Citizen you must notify your employer of your visa status to allow your employer to determine eligibility
• if you're in receipt of income support you must notify Services Australia of  your new income

So there it is! The newest measures the government have put in place to keep a ray of sunshine peeping through the clouds.

Please note, as Certified Practising Accountants, we still have some unanswered questions about the finer details of this new measure. The legislation will be fast-tracked within the next week. Our professional bodies will be briefed and we will be provided with more and more information (possibly overload) as time progresses.

Don't worry, we'll keep you up-to-date on everything as it unfolds, but as always contact us if you have any questions.

Take care and stay safe

 Liz, Julian & the Bluebird team