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How to determine a fall in turnover
To calculate your fall in turnover, you need to compare either:
- Your entities turnover for March 2020 with turnover for March 2019
- The projected turnover for April 2020 with turnover for April 2019
- The projected turnover for quarter starting April 2020 with turnover for quarter starting April 2019
- Any other of the singular months from May 2020 to September 2020 (i.e if you do not meet the turnover decrease now but you do in the coming months)
- The projected turnover for quarter starting July 2020 with the turnover for the quarter starting July 2019.
NB: You should proceed with some caution if you cannot accurately predict your fall in turnover as we expect you would have to repay any funds received in error. For example, if you have experienced only a modest downturn you are likely to have to wait until the end of a month to confirm your projected turnover decrease (compared to a business that has closed completely and can estimate very accurately).
Further details regarding turnover:
- Turnover for this purpose is the entities GST turnover. GST turnover is the sum of all taxable supplies and GST free supplies – but excluding Input tax supplies (eg excluding interest income and residential rent)
- The turnover for this test is calculated in relation to GST turnover by definition, but it does not appear that you have to be GST registered to access the scheme. If you have lodged your business tax return prior to 12 March we believe you will still qualify for the scheme. If you had not yet lodged your 2019 business tax return, you may need to wait for additional information about how the Commissioner of Taxation can apply discretion for your circumstances.
- Only Australian based turnover is relevant, and only the turnover of the entity on a ‘stand-alone’ basis will be relevant.
- For businesses part of a GST group, their ‘GST turnover’ needs to be disaggregated from the group with some other intra-entity considerations.
- How you choose to project your fall in in turnover is not dependent on whether you report quarterly or monthly for your BAS. I.e. a quarterly BAS reporter could use a single month as the turnover test period, and vice versa.
- If you qualify for the JobKeeper payment in one month because of the decline in turnover by the relevant %, you remain eligible – even if your turnover improves. However, you will have to report monthly turnover – more details to follow as it is released.
- Where business has been in operation for less than a year, alternative tests can be applied at the discretion of the Commissioner of Taxation.