Job Keeper Payments – But my business doesn’t have employees?

One of the most gratefully received updates has been the inclusion of small businesess’ without employees gaining access to financial support from the  Government.

Who is eligible?

  • The business can be a Company, Trust, Partnership or Sole Trader
  • There must be an expectation that the turnover of the business will fall by 30% of more. (see my comments on turnover and 30% drop here as it is the same definition)
  • The Business must have had an ABN on or before the 12th of March 2020.  ATO has categorically stated that whilst it is possible to apply for a backdated ABN – a backdated ABN will not count and make your business eligible.  This is particularly an issue with Airbnb hosts – some of which will have an ABN who could claim and those who do not will have no access, despite being potentially an identical business AND EITHER:
    • reported assessable income denoted on their 2018-2019 tax return for this ABN which was lodged prior to 12th March 2020  OR:
    • Clearly ‘made a supply’ eg taxable and reportable income between 1st July 2018 and 12th March 2020 and provided this information to the Commissioner of taxation prior to (or possibly later depending) the 12th March 2020.  This suggests that you have reported a BAS prior to the 12th of March 2020 that indicates income relating to the ABN.
  • The income of the business was a result of active engagement.  That is it cannot be a rental property or investment portfolio where little to no person exertion was required.
  • In the case of a sole tradership – the person cannot already be receiving a Job Keeper or Job Seeker payment.
  • The person in question to receive the Job keeper payment must be 16 years old as at 1st March 2020, be an Australian Citizen/have a permanent visa or Subclass 444 Visa at 1st March 2020.

Special points of note:

My business is a partnership …. how does it work?

  • You need to nominate one of the partnership to receive the Job Keeper payment.  Note ONLY ONE partner may be nominated, despite more than one partner being actively involved in productive functions. 
  • The partnership can also have employees on the Job Keeper grant. The partner is paid in addition to this.
  • The partner must be a person, over 16 years of age etc as mentioned prior. (they cannot be a trust or company)
My business is a trust … how does that work?
  • Just like in a partnership – in addition to any employees per the normal eligibility criteria you can also nominate a single beneficiary (who must be a person, not a company or other entity) for the job keeper payment.
I have a small private company … how does that work?
  • As per trusts and partnerships – you can claim eligible employees AND can nominate a single share holder (who normally is paid via dividends) or a director (who is normally paid via directors fees) to also receive the Job Keeper payment.  Note: the wording from the ATO is vague so it is possible they mean BOTH a single Director AND a Shareholder could be paid Job Keeper payments.  In the spirit of the other business types it would be wise to assume that only one Job Keeper payment for a non-standard employee would be eligible per company.

I am a sole trader … how does it work for me?

  • Sole traders will be treated differently again.  There will be an online application that you will need to fill in.  It will require your tax file number and your ABN.  You will need to declare the type of business activity you are engaged in.  It is expected you will need to report income regularly to the ATO to continue receiving payments.
  • You may also have another income source, such as a waged job.  This is acceptable, however you are not allowed to obtain more than one Job Keeper payments.