Not only that, but those who withdrew their superannuation this year to keep them afloat are not sure of their requirements at tax time either. For example, do you need to pay tax on the money or not?
Experienced tax professional Coco Hou, MD of Platinum Accounting Australia, said there is growing confusion across the community, so it is timely to try to better understand and address these concerns, and tax professionals can help.
To start, she said your eligibility and claims processing will have changed this year, if you worked from home between 1 July 2020 and 30 June this year as a result of the pandemic.
She said: “Just as a refresher, the JobKeeper subsidy was a payment made to eligible businesses affected by the COVID-19 pandemic to support their company in retaining employees. Until the program concluded on 28 March 2021, the subsidy took on many forms as it pushed to include more and more potential employees that were impacted by the pandemic. In its original form, eligible businesses received $1,500 per fortnight per eligible employee to support the people in their company that were employed as of 1 March 2020.
“Where an employee’s total remuneration was less than $1,500 per fortnight before tax, or had been stood down, the employer was required to provide the employee at least $1,500 per fortnight before tax. Where an employee earned more than $1,500 per fortnight, employers used the payment to subsidise the employee’s wages. Self-employed individuals were also eligible to receive the JobKeeper payment.”
Ms Hou said being confused and anxious about how to deal with the JobKeeper subsidy is understandable.
Here, she has answered the most burning questions she has received in relation to JobKeeper, the COVID-19 pandemic and tax time.
Was JobKeeper tax-free?
“No, your JobKeeper payments were deducted under the same legislation that your normal take-home pay packet is. If you’re an employee, you do not need to do anything different come tax time because your employer should have included your tax in your income statement, either as part of a salary, wage or an allowance,” Ms Hou explained.
My employer gave me a large payment before JobKeeper was announced. What does this mean for tax time?
“If your employer gave you a stand-out, lump-sum payment to support you through the initial COVID-19 period before JobKeeper was announced, then this should already be included as part of your salary and wages, similarly to the JobKeeper subsidy. As an employee, you shouldn’t have to do anything different with your income statement when it comes to placing your tax return,” she said.
I’m a sole trader who was eligible for JobKeeper. Were these payments assessable?
According to Ms Hou, if you’re a sole trader who received JobKeeper on behalf of your business, you’ll need to include the payments as assessable income for the business if you haven’t already paid the relevant tax.
Was I paid superannuation on my JobKeeper payment?
“If you were an employee that is paid more than $1,500 per fortnight, the employer’s superannuation obligations to you during this period did not change, and therefore you received the same superannuation contributions. However, if you were an employee that was having their wages topped up to $1,500 per fortnight by the JobKeeper payment, it was up to the discretion of the employer if they wanted to pay superannuation on any additional wages paid by the JobKeeper payment,” Ms Hou said.
What can I claim from my stint of working from home?
According to Ms Hou, while most industries have now returned to their face-to-face set-ups, millions of Australians were forced to work from home at some point over the last 12 months.
She said: “You can now claim 80 cents per hour for every hour worked over the last financial year. This shortcut method was introduced by the government to make it easier for Aussies to claim from their working-from-home expenses, which includes phone and internet, lighting, heating and depreciation on equipment. This new method is a lot easier to comply with; however, it is critical that you kept a record of your hours, like a diary or a timesheet, to prove your work-from-home status.”
If I access my super early, do I need to pay tax?
“No. More than 2 million Australians took money out of their retirement savings early under the superannuation Early Release Scheme in 2020. Those people do not have to pay tax on it or declare it in their tax return,” Ms Hou said.
When is the tax deadline?
“The tax window will open on 1 July and you will have until 31 October to submit your claim,” she said.
Coco Hou is the managing director of Platinum Accounting Australia and Platinum Professional Training, and is a CPA-qualified accountant.