Ten things you need to know about the JobKeeper, JobSeeker payment changes
JobKeeper and JobSeeker payments are about to change and it will impact the hip pockets of millions of Australians. This is how it will affect you.
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JobKeeper payments are about to change and it will impact millions of Australians’ hip pockets. Here’s everything you need to know.
WHAT IS JOBKEEPER?
It is the Federal Government’s $70 billion program that was announced on March 30. It is the largest one-off fiscal measure and is a temporary subsidy for businesses significantly impacted by COVID-19. It was scheduled to run until the end of September and has now been extended to March 28, 2020.
WHAT IS THE AIM OF JOBKEEPER?
To help businesses and jobs survive and provide income support for employers and employees who need it. In April alone it provided income to businesses who suffered an average decline of 37 per cent in income compared to the same time last year.
HOW MUCH ARE JOBKEEPER PAYMENTS?
Eligible employers, sole traders and other entities who have proved they have a turnover that is down by 30 per cent only need to prove it once and can receive $1500 (before tax) per eligible employee per fortnight until September 27.
As of July 15 JobKeeper payments dished out have totalled more than $29.8 billion.
These payments will be reduced to $1200 a fortnight from October.
HOW MANY PEOPLE ACCESSED JOBKEEPER?
The program was taken up by 920,000 businesses and it supported more than 3.5 million individuals during the April and May period alone. So far $30 billion has been handed out in payments.
WHAT ARE THE MAIN SECTORS THAT HAVE TAKEN UP JOBKEEPER?
Industries include construction, professional, scientific and technical services, health care and social assistance.
IS THE JOBKEEPER PAYMENT TAX FREE?
No. JobKeeper payments must be included as income in your tax return.
Tax is withheld from payments at your marginal tax rate so you may end up receiving less than $1500 per fortnight in your bank account.
CAN BUSINESSES STILL APPLY FOR JOBKEEPER?
Yes. You can enrol for the JobKeeper payments at any time until the program closes.
IS JOBKEEPER SUBJECT TO PAYROLL TAX?
For employers who are accepting JobKeeper payments these payments are exempt from payroll tax. This applies to the full $1500 fortnightly payment per eligible employee.
WHAT IS THE CORONAVIRUS SUPPLEMENT?
It’s a fortnightly payment of $550 if you get an eligible income support payment and is taxable income. This is automatically given to people on income support including Jobseeker payments, youth allowance, Austudy and ABSTUDY until September 24.
This will be scaled down to $250 in late September until the end of the year.
From August 4 JobSeeker recipients must connect with employment services and undertake four job searches a month.
There will be penalties if they refuse a job.
WHO WILL CONTINUE TO GET THE CORONAVIRUS SUPPLEMENT?
Both existing and new income support recipients will continue to receive the temporary coronavirus supplements while the economy recovers through until December 31.
HOW ARE THESE PAYMENTS CHANGING?
JobKeeper will scale down gradually over six months from October starting at $1200 a fortnight for full time workers and dropping to $1000 by March 2021.
The wage subsidy will be extended for three months from September 27 at the higher rate of $1200 for full time and $750 for part time workers.
The payment will then drop further to $1000 for full time and $650 for people working less than 20 hours a week in the March quarter.
The 30 per cent drop in turnover will be applied as a test for businesses to qualify at the start of each quarter.
The coronavirus supplement topping up JobSeeker dole cheques will be more than halved to $250 a fortnight from October.
The federal government announced the extension of the support, due to end on September 27, would also coincide with relaxed income rules allowing JobSeeker recipients to earn up to $300 a fortnight without their payments being impacted.
The COVID-19 supplement is on top of the normal $550 fortnightly unemployment benefit.
IS ELIGIBILITY IMPACTED?
Yes. In October eligibility will be reassessed based on decline in turnover. This will be done to ensure only those that require assistance need it.
WHAT HAPPENS IF ELIGIBILITY FOR JOBKEEPER IS NOT BEYOND SEPTEMBER?
If employers do not meet the eligibility beyond September proving a significant decline in revenue it will not impact their eligibility prior to September 28.
However they will not be able to access it beyond September.
WHAT HAS BEEN ONE OF THE MAIN PROBLEMS WITH JOBKEEPER?
Some part-time workers and casuals received an increase in income due to the flat rate payment and the incentive to work additional hours was impacted.
HOW WILL JOBSEEKER BE IMPACTED?
Under existing arrangements single recipients are entitled to $1115.70 per fortnight. This includes $565.70 JobSeeker payment and the $550 coronavirus supplement.
These amounts vary depending on a person’s situation.
This is being wound back from October to $815 a fortnight and the new payment levels runs until the end of the year.
And the coronavirus supplement will be scaled back from $550 a fortnight to $250.
Penalties will kick in for those receiving JobSeeker who don’t accept work when jobs are available.
There is a mutual obligation for those on JobSeeker to take those jobs when they become available.