Recently, the Government announced an extension of the JobKeeper Scheme. Originally ending on 27 of September 2020, JobKeeper has been extended by 6 months to 28 March 2021.
With the extension, the Government also set out the new rules governing how the scheme will operate.
Businesses who wish to receive JobKeeper payments will need to qualify for the 6-month extension period (including businesses that qualified for JobKeeper under the original period), which has been broken up into two separate periods.
JobKeeper Extension Periods:
- Extension Period 1 - Fortnights starting on or after 28 September 2020 and end on or before 3 January 2021.
To qualify, businesses must show a 30% or more decline in actual GST turnover during the September quarter of 2020 vs the September quarter of 2019.
- Extension Period 2 - Fortnights starting on or after 4 January 2021 and end on or before 28 March 2021.
To qualify, businesses must show a 30% or more decline in actual GST turnover during the December quarter of 2020 vs the December quarter of 2019.
Note: The decline in actual GST turnover must be at least 50% for entities with an aggregated turnover of more than $1 billion and 15% for ACNC-registered charities.
The new rules state that the calculation of actual GST turnover is to be “based on the GST attribution rules” (i.e., a supply is taken to be made in a particular test period, if it would be attributed to that particular test period under the GST Act). Calculating your business’ actual GST decline in turnover, the correct accounting method to use and selecting the correct test periods has become more complicated for the extension period. If you would like assistance determining your actual GST decline in turnover, please give us a call at (08) 9217 2400.
Calculating Actual Decline in Turnover
For JobKeeper, actual GST turnover is the amount of sales, excluding supplies such as:
- GST included in sales;
- input taxed supplies (e.g., residential rental income);
- sales that are not connected with your business (e.g., the sale of a private car);
- sales that are not made for payment (unless it is a taxable supply to an associate);
- no supplies payments (e.g., JobKeeper payments);
- donations and gifts (except for payments to DGRs and ACNC-registered charities); and
- sales not connected to Australia.
If a business (or entity) is a part of a GST group, that GST turnover would be calculated as if it is not part of the group, this essentially means that supplies made in the group are including in the actual GST turnover when determining the actual decline in turnover.
Also, GST adjustments and adjustments for bad debts are also excluded when calculating the actual GST turnover.
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