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The alternative decline in turnover test rules for the JobKeeper payment scheme has now been registered by the ATO.
ATO releases JobKeeper alternative test
23 April 2020
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5 minute read
The legislative instrument, Coronavirus Economic Response Package (Payments and Benefits) Alternative Decline in Turnover Test Rules 2020, has now been registered.
The alternative tests will only kick in if an entity cannot satisfy the basic decline in turnover test.
The explanatory statement notes that the alternative tests will only apply to seven circumstances.
These include where an entity commenced business after the relevant comparison period in 2019 or the business did not exist in the relevant comparison period and as a result there was no relevant comparison period in 2019.
It will also cover a circumstance where an entity acquired or disposed of part of their business after the relevant comparison period in 2019, and where an entity has restructured part or all of their business after the relevant comparison period in 2019.
Entities who had an increase in turnover by 50 per cent or more in the 12 months immediately before the applicable turnover test period, or 25 per cent or more in the six months immediately before the applicable turnover test period, or 12.5 per cent or more in the three months immediately before the applicable turnover test period, will also be covered.
The alternative test will also cover entities affected by a drought or other natural disaster in the relevant comparison period in 2019, and entities who have an irregular turnover that is not cyclical, such as what can occur in the building and construction sector.
A sole trader or a small partnership where the sole trader or one of the partners did not work for all or part of the relevant comparison period because they were sick, injured or on leave during the relevant comparison period, and those circumstances affects the turnover of the sole trader or partnership, will also be covered.
Each of the seven circumstances has its own alternative test that is detailed in the legislative instrument.
“The commissioner cannot determine an alternative decline in turnover test in all circumstances,” said the explanatory statement.
“It is only in those circumstances where there is an event or circumstance, be it internal or external to an entity, that is outside the usual business setting for entities of that class which results in the relevant comparison period in 2019 not being appropriate for the purpose of an entity in the class of entities satisfying the decline in turnover test.”
More to come.
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- I have a question-regarding to section 9. Business had substantial increase in turnover:
For testing of if there's 25% sales growth, am I right to compare Mar19-Sep19 against Oct19-Mar20 to validate the test or
should I compare Oct18-Mar19 against Oct19-Mar20?0 - Director on casual for since January company is less than a year. how to apply job keeper for the director as an employee or business participant ? Salary is on regular basis.0
- once u get jobkeeper you still have to report future turnover0
- This is very interesting - but I have a question - if you are comparing the revenue for April to compare against a previous period, would it be lawfull/ethical to simply not invoice or seek payment from your customers for the rest of April, so that you don't register as much income in April, and therefore you might qualify for JobKeeper. Then you simply invoice your customers in May or June and by that time you are locked into JobKeeper and keep getting it for the whole 6 months Would that be allowed?0
- No it's not allowed as it comes under scheming and have adverse consequences.
If you are following cash / accrual basis for GST turnover reporting it must be followed for both periods in comparison.
Cannot choose one period on cash basis and one on accrual basis.
Strongly not recommended
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