The government’s latest tranche of coronavirus stimulus – the “jobkeeper” payment – is going to help a lot of business operators and their employees sleep easier through this crisis.
It’s important to note how monumental this piece of stimulus is. Any business that can prove a 30% drop in earnings will be eligible for a $1500 fortnightly payment for each employee. And in my view, the government will want to pay out this money, so they’re unlikely to be too nit-picky if you can only prove a 27% drop, for example.
Of course, there are concerns around the potential for employers to rort the system, but I think this is unlikely due to the introduction of single-touch payroll for all businesses last year. The ATO now has almost-immediate visibility on business revenue, which will make it easy for them to judge drops in revenue, but also make it difficult for dodgy operators to game the system.
From an employee perspective, all who have been affected by this crisis should benefit from it, but some more than others. As it’s a flat $1500 payment, anyone who had been earning more than that per fortnight will still see a reduction in their income, but anyone who normally earned less will see a pay rise coming their way, because employers will not have discretion for how they distribute the funds to employees – each $1500 payment must be passed on in its entirety.
There has also been some confusion about just who is eligible for the payments as much of the commentary has been around businesses and sole traders, but my reading suggests that basically anyone who operates under an ABN should be eligible for these payments, including those who pay themselves through distributions from a family trust.
As has become the new normal, this is a fast-moving and fluid situation and we will do our best to keep you updated on developments. In the meantime, if you have any questions or concerns, don’t hesitate to get in touch.
Virgin Money Flyer Card - 0% for 8 Months Balance Transfer Click HERE