COVID-19 Update: JobKeeper – Payroll Processing Information / Commercial Tenancies / Working From Home
JobKeeper – Payroll Processing Information
The JobKeeper scheme was confirmed as law by parliament yesterday, 8th April 2020. The scheme will commence from 30/03/2020 and will be in place for a minimum of six months.
In order to receive the JobKeeper payments eligible employers need to continue to pay eligible employees, the first fortnightly period being 30/3/2020 – 12/4/2020. Accordingly, you may be in a position where you need to process a payroll for your employees in the next few days. Please note that if you are using a monthly pay cycle then you can continue with this cycle. You will need to ensure that eligible employees receive the equivalent of $1,500 per fortnight.
The ATO have indicated that the easiest way to get access to the reimbursement is via payrolls lodged via Single Touch Payroll. This will be used to identify the amount due to be reimbursed to the employer. If a client is not using STP then a manual system will need to be implemented to provide details to the ATO. We assume that this will lead to longer waiting times for the payment. The first payment is expected in early May.
If you are confident that you will be eligible for the JobKeeper scheme the payroll scenarios are as follows:
Please note that the JobKeeper amount is before tax therefore you will need to calculate and withhold tax as per a regular pay. Using a standard tax table this will equate to a $1,308 net payment for the staff member. No super is required on the JobKeeper component of the pay although you can choose to pay super.
If your staff have worked in this period and their gross pay is greater than $1,500 per fortnight then no additional payments are required. The company will be reimbursed $1,500 per fortnight in early May. As the payment is for work performed then super will apply to the wages as per usual.
If staff have worked some hours but this equates to less than $1,500 per fortnight then you will need to pay them for the hours worked, this component will attract super as per usual. You will then top them up to $1,500 per fortnight gross using the JobKeeper amount, no super is required on this component.
Staff who have been stood down and worked no hours will solely receive the $1,500 gross per fortnight JobKeeper payment. No super is required.
You may wish to create a new payroll category to process the JobKeeper component of your payroll.
We are still waiting on more clarification on the process required for Sole Traders and businesses without employees, we will send an update on this when information is available.
Commercial Tenancy Code of Conduct
Updated information has been released in relation to a commercial tenancy code of conduct.
At a high level the key points are:
The National Cabinet has agreed that a mandatory code will be legislated in each state and territory. The code will apply to any tenancies where the tenant is eligible has an annual turnover of $50 million or less.
Landlords must not terminate a lease or draw on a tenant's security. Tenants must honour the lease.
Landlords will be required to reduce rent proportionately to the trading reduction in the tenant's business over the course of the pandemic period through a combination of waivers of rent and deferrals of rent.
Waivers must account for at least 50% of the reduction in rental provided to the tenant during that period.
Deferrals must be covered over the balance of the lease term and over at least a 12 month period (so if a lease only has 6 months to run after the pandemic period the tenant will still have a 12 month period to pay the deferred rent).
The arrangements will be overseen by a binding mediation process.
The above process will be run by the states and territories.
The PM also stated that banks must "come to the table here and provide the support to the landlords and I would particularly send that message to international banks operating in Australia".
There will be no national regime for residential tenancies; residential tenancies will be left to each state and territory.
Tax Deductions - Working From Home:
The ATO have released an updated working from home policy for those forced to work from home due to Covid-19. You are now able to claim a rate of 80 cents per hour from 01 March 2020. You are only required to keep diary records of the hours worked from home in order to claim this amount.
The increased hourly rate covers the following expenses:
electricity for lighting, cooling or heating and running electronic items used for work (for example your computer), and gas heating expenses the decline in value and repair of capital items, such as home office furniture and furnishings
your phone costs, including the decline in value of the handset
your internet costs
computer consumables, such as printer ink
the decline in value of a computer, laptop or similar device.
Accordingly, a separate claim is not allowed for these items.
When completing your 2020 tax return please send in the hours worked from home and we will include this in the deductions.