That’s right, the Government’s $130 billion JobKeeper initiative has passed both houses of Parliament and is awaiting royal assent, but business owners are being urged to take care in how they proceed.
The Government’s JobKeeper program passed the Senate last night, all but establishing the $130 billion program into law.
UPDATE: The legislation associated with this stimulus has since gained royal assent and is now law.
But Chartered Accountants Australia and New Zealand (CA ANZ) is now warning business owners to take their time, as many of the legislation’s details are yet to be confirmed.
“The legislation has claw-back rules empowering the ATO to recover overpaid amounts and target those who weren’t entitled to payments received, plus interest,” CA ANZ’s Australian tax leader Michael Croker said in a statement.
The legislation passed the Senate last night, though many of the details are yet to be confirmed.
Useful resources regarding the JobKeeper scheme:
What is known is that businesses must keep pre-payment records for five years, unless the Commissioner of Taxation states otherwise.
It also says there will be recordkeeping rules even after payments have been received.
“It’s so important not to blindly go after the money without some evidence of the economic impact of COVID-19 on business turnover,” said Croker.
“Employers should get ready and get set before they go.”
Additionally, KPMG issued advice in a statement saying businesses should make sure they have a robust record keeping program in place.
“Each employer must focus immediately on ensuring that it has a system in place for April to make sure that the employees covered by its JobKeeper application receive (in April) at least the necessary $1,500 per fortnight (or equivalent for a monthly pay cycle), backdated to 30 March,” it said.
“This will be a prerequisite for receiving the subsidy (in arrears) from the Federal Government in early May.
“Subsequent months will play out in similar fashion.”
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The JobKeeper package will make several changes to the Fair Work Act in order to help businesses make flexible arrangements.
HR Central chief executive Damien Gooden said the legislation will “give businesses the best chance of surviving this downturn” by providing more flexibility to employee arrangements.
“Prior to the legislation any changes to employee arrangements had to be by agreement,” Gooden told The Pulse.
“Now employers have the ability to stand employees down. That is, have them not work at all.
“They also have the ability to direct employees to change their work location, duties and days or hours.”
The legislation affords small business owners much more flexibility in managing their people, while providing a safety net for those that have their income reduced as a result of these changes.
“These changes will give small business the best chance of surviving this downturn and being in a position to ‘turn back on’ with a connected workforce who have been supported by these measures,” said Gooden.
“While a lot of power is being handed to employers, HR Central would encourage a strong employee relations approach trying where possible to get as close to a win-win as possible given the trying conditions.
“This might include engaging employees in alternate duties, filing, painting, revising or implementing new systems, training and more.”
HR Central has prepared a number of FAQ resources relating to the new legislation.
In order to receive the JobKeeper subsidy, businesses must:
Greg Ellis, chief executive at MYOB, said, “We applaud Parliament for passing the Government’s historic $130 billion wage subsidy package to keep small and big businesses paying their staff through the downturn ahead”.
“The JobKeeper allowance will help keep many thousands of Australians who work in the small business sector employed,” said Ellis.
“This is another important step in the Government’s demonstration of commitment to small business in this crisis and we look forward to seeing this continue into the recovery phase.”
He also highlighted the importance of Australia’s accounting and bookkeeping professionals at this time, who are not only preparing for the usual EOFY crunch, but are now also working hard to keep up digest and communicate important stimulus-related information for their clients.
“MYOB will work closely with our accountant and bookkeeper partners to help implement the allowance as quickly as possible,” Ellis affirmed.
“Accountants and bookkeepers are critical for small business, in the provision of sound financial guidance to help steer owners and operators through these difficult times.”
More details are to be released by the ATO once the JobKeeper package is officially made into law. MYOB recommends speaking with a certified accountant or financial advisor. Click here to find specialist advisors near you.