Businesses wishing to use the JobKeeper payment scheme may find themselves running into many logistical uncertainties, as claiming the JobKeeper payment scheme can be a complicated and risky process. Here are the steps you need to take now to benefit.
Businesses who have satisfied the eligibility requirements of a minimum 30% reduction in their turnover for at least a month, with a turnover of less than $1 billion a year, will be able to apply for the scheme. This includes sole traders who are actively engaged in the business and are not a permanent employee of any other employer.
To claim JobKeeper payments, eligible employers must:
Receiving JobKeeper payments can put small businesses at risk of cash flow problems due to the requirements of JobKeeper payments. To be eligible, businesses must back pay the minimum $1,500 per fortnight to nominated employees from 30 March 2020, despite JobKeeper reimbursements not being provided until the first week of May. Employers who normally pay employees less than $1,500 each per fortnight (often these are part-time and long-term casual employees) may find themselves in further financial strain for at least a month as the employee wages will likely exceed the amount they would ordinarily pay in wages despite already losing 30% of their turnover.
Employers who apply for the scheme but fail to pay their eligible employees may face penalties up to $126,000 for individual employers, or $630,000 for corporations as a breach of the Fair Work Act. The ATO can also claw back funds (with interest) which it deems to be improperly paid. The scheme also requires monthly reports of current and projected GST turnovers, where eligibility consequences can be imposed for not meeting record keeping requirements.