Paying your eligible employees
To be eligible for the JobKeeper payment you must pay your eligible employees at least $1,500 (before tax) for JobKeeper fortnight. This payment should be paid in line with your existing pay cycle through your existing payroll program.
You will be able to claim the two fortnightly payments in April, even if payments to employees were paid late – provided they are paid to eligible employees by the end of April. That is, you MUST pay at least $3,000 to all eligible employees prior to the end of April in order to claim JobKeeper for April. Payments for subsequent fortnights should be in line with your usual pay cycle.
You cannot claim the JobKeeper payment in advance – ie you must have paid your eligible employees in the previous month – the payment is a reimbursement to the employer. EG if claiming in May, you must have made at least the two fortnightly payments to employees before the end of April; when claiming in June, you must have made at least the fortnightly payments in May.
Employees who earn MORE than $1,500 per fortnight: You should continue to pay them their regular salary or wages. You will receive a subsidy of $1,500 to assist you in covering these wages.
Employees who earn LESS than $1,500 per fortnight: You must pay at least $1,500 per fortnight to eligible employees, even if they would ordinarily earn less than $1,500 per fortnight. EG if you have a permanent part-time employee who ordinarily earns $500 per week before tax, you must now pay them $750 per week before tax in order to remain eligible for the JobKeeper payment for them. You can not pay your employees less than $1,500 per fortnight and keep the difference.
Employees stood down: If you have eligible employees that were stood down after 1 March 2020, you can start paying them $1,500 per fortnight.
Employees terminated: If you have eligible employees that ceased working for you after 1 March 2020, you can re-engage them and pay them at least $1,500 per fortnight. Only eligible to claim fortnights after you have re-engaged them.
Tax consequences: The JobKeeper payments are not subject to GST, but they are assessable income of the business. Payment made to employees are deductible to the extent that would normally be deductible.
Superannuation Guarantee: Legislation is yet to be passed, but it is expected that new rules will be introduced regarding SG payments paid on additional payments made to employees. (ie with payments made to employees who ordinarily earn less than $1,500 per fortnight but are now receiving $1,500 per fortnight due to JobKeeper scheme, it is expected that SG won’t be payable on the ‘additional’ amount). But this is subject to legislation passing.