Key Points

• Registrations for the JobMaker Hiring Credit scheme are now open
• Eligible employers can access $200 per week for each eligible additional employee, aged 16 to 29 years, and up to $100 per week for each eligible additional employee aged 30 to 35 years
• Hiring credits are paid every three months in arrears, with claims for the first quarterly payment to open on 1 February 2021.

Full Article

The ATO has now opened registrations for the JobMaker Hiring Credit scheme, following the release of rules by Treasurer Josh Frydenberg last week.

Administered by the ATO, the scheme will run for 12 months from 7 October.  You can register through the ATO Online Services, the Business Portal, or through a registered tax and BAS agent.

Eligible employers can access up to $200 per week for each eligible additional employee, aged 16 to 29 years, and up to $100 per week for each eligible additional employee aged 30 to 35 years.  The hiring credit is paid every three months in arrears, with claims for the first quarterly payment to open on 1 February 2021.

To be eligible, the employee will need to have worked for a minimum of 20 hours per week, averaged over a quarter, and received the JobSeeker Payment, Youth Allowance (Other) or Parenting Payment for at least one month out of the three months prior to when they are hired.

Eligible Employers

The employer must:

• Register for the JobMaker Hiring Credit scheme, and,

either

• operate a business in Australia
• be a not-for-profit organisation operating in Australia
• be a deductible gift recipient (DGR) endorsed either as a public fund or for a public fund you operated under the Overseas Aid Gift Deductibility Scheme (DGR item 9.1.1) or for developed country relief (DGR item 9.1.2). 

• Hold an Australian business number (ABN)
• Be registered for pay as you go (PAYG) withholding
• Have not claimed JobKeeper payments for a fortnight that started during the JobMaker period
• Be up to date with income tax and GST returns for the two years up to the end of the JobMaker period for which they are claiming
• Satisfy the payroll increase and the headcount increase conditions
• Satisfy reporting requirements, including up to date Single Touch Payroll (STP) reporting
• No belong to one of the ineligible employer categories.

Ineligible employers

An employer is not entitled to the JobMaker Hiring Credit scheme for a JobMaker period if any of the following apply:

• The employer has a Major Bank Levy imposed on the entity, or a member of its consolidated group, for any quarter on or before 30 September 2020
• An Australian government agency (within the meaning of the Income Tax Assessment Act 1997)
• A local governing body
• Is wholly owned by an Australian government agency or a local governing body
• Is a company in liquidation or provisional liquidation
• Is an individual who has entered bankruptcy
• Is disqualified because the entity terminated the employment or reduced the hours of work of an existing employee or employees for the sole or dominant purpose of receiving or increasing payments under the JobMaker Hiring Credit scheme
• Is a sovereign entity. The term ‘sovereign entity’ includes a body politic of a foreign country or a foreign government agency. Resident subsidiaries of a sovereign entity may be eligible employers if the entity satisfies the other eligibility criteria and is not ineligible due to any other exclusion. This is different to JobKeeper (resident subsidiaries were not eligible employers).
• Terminating employment or reducing hours of existing employees
• You will not be eligible, or you will be disqualified, if you enter into an arrangement to artificially inflate your headcount or payroll by terminating or reducing the hours of an existing employee in an attempt to access or increase payments under the JobMaker Hiring Credits scheme. Generally, this rule would not apply to a termination or reduction in hours that the employee has volunteered for to meet their needs or preferences. However, the employer could be in scope for disqualification if the employee was manipulated or coerced into agreeing to the changes.

In addition to losing access to JobMaker Hiring Credit payments, employers should consider their obligations under the Age Discrimination Act 2004 and the Fair Work Act 2009.

Employers cannot be receiving JobKeeper payments at the same time and must also meet a number of eligibility conditions, including being registered for pay-as-you-go (PAYG) withholding, holding an Australian business number (ABN), being up to date with their tax lodgment obligations, and be reporting through Single Touch Payroll (STP).

Entities exempt from STP reporting will need to meet additional requirements and provide these details by contacting the ATO by phone.

If you have any questions or need advice and clarity specific to your situation, feel free to contact Semmens & Co on 03 8320 0320 for a free consultation.