Now is the perfect time to start analysing and planning for your 2020 tax year!

You may have already done a quick analysis when considering what COVID-19 related stimuli you might be able to access, but don’t forget that the normal tax processes are still trundling along and it’s important to think about any possible changes you need to make BEFORE the end of the financial year.

We love helping our clients plan on both a business and personal level no matter how simple or complex your situation, so please let us know if we can be of assistance.

Make It Happen!

While you were paying your respects (and playing your cornets) in the driveway, Treasury has been hard at it, making further substantial tweaks to the operation of the JobKeeper scheme.  While so far we only have announcements and the devil will definitely be in the detail, here are some of the key changes proposed:

  1. Potential to allow service entities to access the JobKeeper scheme, even where it is the operating entity and not the service entity that has suffered the decline in turnover.  Service entities are very commonly used in many areas of professional practice (accounting, legal, IT, medical, pharmacy – you will know if you have one) whereby a separate entity employs the staff and charges a fee to the operating entity. This is a major additional concession, however the language used by the Treasurer so far is frighteningly vague and imprecise, so keep the corks in the champagne for now and we will monitor and report on developments as they occur.
  2. GST turnover for calculating the 30% decline – originally, businesses that lodge BAS and pay GST on a cash basis could assess their decline in turnover on either a cash or accruals basis, while businesses that report on an accruals basis had to use accruals for the test – UNTIL NOW.  Now, all businesses can assess their decline on a cash or accruals basis.  So, Officeworks will do well on the supply of calculators so you (or we) can crunch the numbers from several new angles to see if your business can qualify (please contact us if you believe you now are in with a chance and weren’t before).  You only have to satisfy the decline by one of the methods (including the recently announced alternative tests if they are relevant to your circumstances). 
  3. One in all in appears to be the only way to access JobKeeper at all.  Previously, while there have been many official and unofficial statements about employers not being able to pick and choose which employees to pay the $1,500 per fortnight to, the actual written rules (ie the L.A.W.) did not technically support this position.  As an acknowledgement of the fact, the Treasurer has now confirmed the legislation will be amended to make it ‘clearer’ that unless an employee opts out, all eligible employees must be paid for the employer to receive any Jobkeeper subsidy.  Please take the few days we have left in April to reconfirm you have all eligible employees in and paid (noting as long as you pay them or top them up to $3,000 for the month of April by 30 April you will potentially qualify).
  4. The registration date has been extended and you now have until 31 May to register to claim for the fortnights in April and May – provided you meet all the eligibility requirements for each of those fortnights (ie $3,000 in total paid during April and $1,500 for each of the fortnights in May).  So, this is not really a huge concession as registering is the easy part. 
  5. Tougher on the kiddies – previously employees had to be aged 16 years or over on 1 March 2020; now the rules also exclude those 17 and under who are full-time students and not financially independent.
As the clock is ticking very loudly, please contact one of your friendly Halletts team members as soon as possible if you need any further information or assistance.
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The ATO has just released seven alternative decline in turnover tests for businesses and sole traders that do not fit neatly into the box and meet the original test to qualify for JobKeeper. The new tests cover a range of possible scenarios that might otherwise result in ‘failing’ the original test, including:

  1. different mathematical formulae and approaches;
  2. business acquisitions;
  3. changes in business structures;
  4. businesses with a substantial increase in turnover in the previous periods – either the past 12 months, or 6 months, or 3 months (but it is not quite that simple);
  5. businesses affected by drought or natural disaster;
  6. businesses with irregular turnover;
  7. sole traders and small partnerships with sickness, injury or leave.

Note, these measures are to assist businesses that would not otherwise qualify and do not operate to disqualify anyone who is otherwise eligible.

They are also tightly defined and do not apply automatically.

The deadline for registering with the ATO to qualify for the full JobKeeper entitlements and payment/top-up of eligible employees to $1,500 per fortnight or $3,000 per month is 30 April. Note, if you do not qualify for JobKeeper in April you can potentially register in future months once you have met any of the decline in turnover requirements.

If you have missed out to date and think you might be able to apply via one of the alternative measures please feel free to contact us, and we will see if we can make it (legally and ethically) work for you.

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