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‘No further changes to JobKeeper eligibility’

Jotham Lian and Maja Garaca Djurdjevic
Jotham Lian and Maja Garaca Djurdjevic
01 May 2020 1 minute readShare
Treasury Deputy Secretary Jenny Wilkinson

The Treasury has confirmed that there will be no further changes to the JobKeeper eligibility criteria, after recently announcing an alternate test for special purpose service entities.

Speaking before the parliamentary inquiry into the government’s COVID-19 response, Treasury Deputy Secretary Jenny Wilkinson said that no further “significant” changes will be made to the JobKeeper eligibility criteria.

“We’re continuing to receive information from entities, bits and pieces about how the program is rolling out, but theres nothing in particular that were working on at this stage,” Ms Wilkinson said.

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She noted that while no changes are expected, the Treasury is currently working on the alternate test for special purpose service entities, announced by Treasurer Josh Frydenberg last Friday.

“Those changes to the rules that the Treasurer announced on Friday will be made this week. So, were working on defining those rules and getting them published this week to provide clarity to people,” Ms Wilkinson added.

 

But, on Friday, the government announced it will be clarifying the operation of some rules “as soon as possible”, hinting that they may not be available just yet. 

Speaking to My Business sister title Accountants Daily, Chartered Accountants Australia and New Zealand tax leader Michael Croker said the new alternative test would be important for service entities who were supplying employees to group companies.

“Treasury officials, ATO officials and parliamentary draftsmen are working flat out to get another legislative instrument ready to cater for the situation where you have inside a company group a bespoke company which provides the services of employees to other group companies,” Mr Croker said.

“What we’re envisaging here is a combination of the turnover calculation so that you take into account the turnover of the related entities.”

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He added: “This is an important one because, for these bespoke service entities, that’s all they do, they just have labour and they charge out among the group companies a service fee for providing those workers to the group companies.

“Now as you can imagine, the service entity turnover is not going down while it is entitled to this constant charge, and the only way to get the turnover down would be to start sacking employees in the service entity, and no one wants that, so it is a good move.”

Mr Croker also noted that further guidance on service trust arrangements could also be on the cards.

“The other dialogue we’re having is around our profession and the use of service trusts or service companies which support the activities of accounting firm partnerships, or a law firm partnership, or engineers, or architects — it is a model that is used across a whole host of professions, so we’re looking on some news on that front as well in response to the advocacy work that we are doing,” he said.

‘No further changes to JobKeeper eligibility’
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Jotham Lian and Maja Garaca Djurdjevic
Jotham Lian and Maja Garaca Djurdjevic

Maja Garaca Djurdjevic is the editor of My Business. 

Maja has a decade-long career in journalism across finance, business and politics. Now a well-versed reporter in the SME and accounting arena, prior to joining Momentum Media, Maja reported for several established news outlets in Southeast Europe, scrutinising key processes in post-conflict societies and enabling citizens to influence decision-making.

You can email Maja on [email protected] 

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