Jobkeeper Made Simpler For Sole Traders, Trusts, Partnerships And Companies

Posted Under: None Posted On 18/04/2020

Dear Business Owners,

The ATO has just issued the guidelines for applying for JobKeeper for Sole Traders, Trusts, Partnerships and Companies. We’ve summarised it and simplified it as much as we can, but we’ve included the link for the details at the end of the email.

“A limit applies of one $1,500 JobKeeper payment per fortnight for one eligible business participant. If your entity also has employees, you may also be able to claim additional JobKeeper payments of $1,500 per fortnight per eligible employee.” ATO

So this means that as an Employer you can possibly get the JobKeeper for your employees, and also one JobKeeper payment for your entity.

Some important details we want to point out are –

ENTITIES WILL BE ELIGIBLE IF –

They carried on a business in Australia on 1 March 2020;
satisfied the fall in turnover test;
had an ABN on 12 March;
and lodged on or before 12 March either a 2018–19 income tax return, or an activity statement or GST return for any period that started after 1 July 2018 and ended before 12 March 2020. (If you haven’t met this criteria, please contact us.)

These entities will then need to NOMINATE AN ELIGIBLE BUSINESS PARTICIPANT who must –
not be employed by the entity;
be actively engaged in the business;
be either a sole trader, a partner in a partnership, an adult beneficiary of the trust, or a shareholder or director in the company.

DIFFERENCES TO JOBKEEPER PAYMENT FOR EMPLOYERS (which we emailed earlier this week) –

While Employers have a wage condition that must be met which requires them to pay a minimum of $1,500 per fortnight to their eligible employees, there is no requirement for Sole Traders, Partnerships, Trusts and Companies to have to do this (that is, show you have paid yourself this money).

When your entity gets the money, what you do with it after that is up to the entity. So, there’s no requirement to pay it out or pay it to the nominated individual. (So, we were just discussing that if you were in a partnership, one person could apply for the entity, but the $1500 could be distributed to the partners as agreed.)

There is no requirement for the entity to register for PAYG withholding, start reporting through Single Touch Payroll, or pay salaries and wages to the individual. In the case of a company or a trust, if you have only ever made trust distributions or paid dividends, you don’t have to pay the JobKeeper payment as a salary or wage out to the individual.”

And, just so you know though, the JobKeeper payment received from the ATO forms part of the assessable income of the entity.

HOW TO ENROL FOR THE JOBKEEPER PAYMENT

When you have identified that your business is an eligible entity and your individual non-employee is an eligible business participant you need to enrol.

Your entity can ENROL for the business participation entitlement from 20 April 2020 using an online form, which will be available on the ATO website. But you need to enrol by the end of April for payments in either the fortnights starting 30 March 2020 or 13 April 2020.

For the full details of the JobKeeper payment you can refer to the Fact Sheet from the ATO at this address – https://www.ato.gov.au/General/JobKeeper-Payment/Sole-traders-and-other-entities/

Again, if you have any questions, give us a call. 07 55261855.

Kind Regards,
Scott, Kim and the team at A Counting House