Many businesses are finding it difficult to meet the Treasury’s turnover thresholds, while others are intimidated by the gap between when they must start paying staff and the official launch of JobKeeper in May.
Revealing these statistics in her testimony to a Senate select committee looking into the government’s COVID-19 response, Treasury deputy secretary Jenny Wilkinson admitted to a delay in pushing out the alternative turnover tests.
Ms Wilkinson explained that the ATO opted to extend the time for businesses to pay employees for the first two JobKeeper fortnights to 8 May, and the time they have to enrol until 31 May, due to the late introduction of the tests and the Treasurer’s further rule tweaks late last week.
“That extension was provided because it has taken perhaps a few extra days than we had expected in order to land the detailed alternative turnover tests, which are the alternative ways in which businesses can demonstrate their eligibility for the scheme,” Ms Wilkinson said.
“As the Treasurer announced on Friday night, there are some administrative changes to the rules in order to address some issues which have arisen over the course of the last two weeks.
“So with the new rules and the new legislative instrument having been put in place either late last week or early this week, our view was that it was reasonable to give those businesses who had felt that it wasn’t clear whether they were going to be eligible extra time to assess their eligibility and then to participate in the scheme.”
On Tuesday, Australian Small Business and Family Enterprise Ombudsman Kate Carnell applauded the deadline push.
Ms Carnell said the 8 May extension would go a long way for businesses concerned about paying their staff the $1,500 fortnightly JobKeeper payment for the first month prior to payments flowing in early May.
“This will come as a welcome relief for small businesses struggling with cash flow,” Ms Carnell said.
“Small businesses now have extra time to deal with cash-flow pressures as a result of any delays with their financial arrangements.
“It’s especially critical now that those small businesses that had chosen not to apply for JobKeeper because they were worried they couldn’t pay their staff by April 30, do so now.”
Businesses have until 31 May 2020 to formally enrol to claim JobKeeper payments.
However, the sooner an employer pays their staff for April and enrols, the sooner the ATO can reimburse them the JobKeeper payments.