JobKeeper Myths Busted by a Qualified Professional
Coming up to the second round of JobKeeper reporting and we are still so bloody shocked by the amount of crap information being thrown around in relation to who is eligible for this funding.
And more importantly, why are people not qualified to give this advice so happy to throw around these “JobKeeper Myths” like confetti??
Let me bust some of the crap information and myths around JobKeeper that people are sharing. And whilst I am at is, I will give you the correct information, from a qualified professional, who is legally registered to give this advice:
- Everyone gets JobKeeper. NO NO NO NO NO. Did I mention No? There are specific rules as to which business owners are eligible for JobKeeper. It is not just the 30% decline in turnover you need to look at. There are also rules around ensuring that either a tax return or BAS report has been lodged with the ATO on time. And separate rules for new businesses since 1 July 2019. Late lodgements, despite the 30% decline in turnover, could mean your business is not eligible for JobKeeper
- All staff get JobKeeper. NO. There are strict eligibility criteria for employees to be considered for JobKeeper. If they were not on the books in a payroll capacity at 1 March 2020, then they will never be eligible. Casuals have further rules that they need to have been employed for a minimum of 12 months as at 1st March 2020.
- You can enrol SubContractors for JobKeeper, they are the same as Employees. NO. Sorry, but subcontractors are not the same as employees. If subcontractors are not run via payroll and reported on your activity statement to the ATO via the payroll section, then they are not deemed employees for JobKeeper purposes.
- I have enrolled the full time employees but not the part time ones. NO. If the business elects to be part of the JobKeeper program they can’t play favourites. All eligible employees must be given the employee nomination form. Employees can choose to not tick “yes” on the form. If employees do not complete the nomination forms, you cannot receive JobKeeper for them.
- My VA gave me advice on JobKeeper and she was super cheap. NO. Who can charge a fee for JobKeeper advice is determined by the tax practitioners board. It is illegal for anyone other than Tax agents or BAS agents to charge a fee for JobKeeper. So if anyone is giving you advice, please please please make sure they are actually qualified to do so. And make sure they are legally allowed to charge a fee for that service.
- We need to have a 30% reduction in turnover every month. NO. Once you choose to enrol in the JobKeeper system, you are telling the ATO which month you have met all the required tests including the 30% decline. You need to keep that information for audit purposes. But going forward you do not need to assess your eligibility each month. You do need to do monthly reporting, but that is separate to the initial eligibility requirement. Once you are in, you are in.
- I am going to charge my employees a fee for JobKeeper. NO. WTF. Seriously WTF. We have actually heard stories from people saying their boss is charging them an “admin fee” to process JobKeeper. Hell no. Totally illegal. There is no cost to be charged from the employer to the employees for JobKeeper – ever.
- JobKeeper is like free money. NO. Nothing is ever really free is it? JobKeeper money is assessable income to the business that receives it. It doesn’t form part of your “GST turnover” however it will form part of your profit reports and you should factor that in to any up coming end of year tax calculations. You should also factor this in for any Centrelink income thresholds.
- I don’t have to pay JobKeeper to my employees. NO. JobKeeper is a wage reimbursement for wages you have already paid. So if you haven’t paid wages to staff during the month at a minimum of $1500 gross per fortnight, you will be ineligible to get the JobKeeper reimbursement for those staff. It is absolutely mandatory to top up any eligible employees to that minimum threshold each fortnight. Business owners cannot keep the excess to themselves.
- I am a sole trader and will now report wages for myself via payroll. NO. As a sole trader, you can’t employ yourself. Not now, not ever. You do not, and should not, set yourself up in your payroll system and report wages for yourself. You should have enrolled yourself as an Eligible Business Participant, and not an employee.
- JobKeeper payments happen automatically. NO. Monthly reporting is required to be done every month or no JobKeeper payments will be received. May JobKeeper reporting opens on the ATO portal on the 1st of June. You have until the 14th of June to complete the May reporting. June reporting happens the first week of July, and so forth. Payments are once a month and will only happen if you do the monthly reporting by the due date.
- Accountants can register business owners without their consent. NO. Absolutely NOT. All lodgements with the ATO done by a registered agent require signature or written approval from the client in question. Email approval is acceptable, but digital signature is the best (technology makes this easy). Tax agents or BAS agents should not be registering you for JobKeeper without your knowledge. They should not be lodging monthly JobKeeper reporting without your consent. This needs to happen each month. A blanket “JobKeeper six month approval” is not accepted by the ATO.
Whilst JobKeeper authorisations, monthly reporting, reviewing eligibility, running various reports, assessing alternative turnover tests is all extra work and often looked as as a pain in the bum, we see this as a good thing. It shows our clients we are doing the right thing. It shows our clients we are not just doing whatever the hell we like. It shows our clients that we can be trusted.
And it shows our clients that we are serious about the rules. If your tax agent or BAS agent is not doing this, you need to have a serious chat to them about why they are not abiding by the tax practitioner and ATO rules. If they are cutting corners here, where else are they cutting corners?
If you are seeking paid assistance from someone who is not a registered tax agent or BAS agent, I beg you to reconsider their qualifications. Legally, they should not be charging for any form of JobKeeper service.
“JobKeeper Myths are just that – myths. Information that is not necessarily meant to cause harm, but if relied upon, could cause catastrophic implications.”
As accountants and BAS agents, we want you to get it right. We want you to get the entitlements that you are absolutely eligible for.
What we don’t want you to do, is get caught up in an ATO audit and find that you are not eligible for JobKeeper, or you have received it for ineligible staff, because you have relied on inaccurate advice. If there ever was a time to invest in a bloody good BAS agent or Tax agent, now is the time. Your sanity, your peace of mind and your business will thank you.