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JobKeeper 2.0

On 21 July 2020, Treasury released the fact sheet Extension of the JobKeeper Payment setting out the details of JobKeeper 2.0, as follows:


JobKeeper Payments will now be payable until 28 March 2021


JKPs will now be made beyond 27 September 2020 with two separate extensions, being:

  • Extension period 1 – which covers the seven JobKeeper fortnights that commence on 28 September 2020 and end on 3 January 2021; and

  • Extension period 2 – which covers the JobKeeper fortnights that commence on 4 January 2021 and end on 28 March 2021.

Note: whilst employers will generally qualify for JKPs in the same way, it is important to note that they will need to separately satisfy a new Decline in Turnover Test for both Extension Period 1 and Extension Period 2. Refer below.


JKPs will now be made at two different rates


Where an employer, sole trader or an eligible entity with an eligible business participant (‘EBP’), qualifies for a JKP, they will either be paid at the:

  • Full rate; or

  • Reduced rate.

An employer will be paid at the full rate if, in the four weeks of pay periods before 1 March 2020, the employee was working in the business or not-for-profit for 20 hours or more a week on average.


A sole trader EBP, or an eligible entity with an EBP, will be paid at the full rate if the EBP was actively engaged in the business for 20 hours or more per week on average in the month of February 2020.


Where the employee (or EBP) did not achieve the 20-hour average, the JKP will be made at the reduced rate. However, the Commissioner will have a discretion to set out an alternative test where an employee’s or EBP’s hours were not usual during the February 2020 reference period.


Note: where the employer only qualifies for a JKP at the reduced rate, they only need to pay that reduced amount to the employee in order to satisfy the wage condition. The Treasury fact sheet also notes that the JKP will continue to be paid in arrears.



What are the two JobKeeper 2.0 rates?


As noted above, from the JobKeeper fortnight commencing 28 September 2020, JKPs will be made at two different rates (i.e., at the full rate or a reduced rate).


These rates will be fixed for all of Extension Period 1 but will be adjusted downward for Extension Period 2. Refer to the table below.

What will JobKeeper 2.0 look like?


The following table sets out the full and reduced JKP rates for Extension Periods 1 and 2.


Re-satisfying the Decline in Turnover Test


Under the existing JobKeeper Scheme, an employer, a sole trader EBP or an eligible entity with an EBP was only required to satisfy the Decline in Turnover Test once in order to be entitled to all 13 JKPs from 30 March 2020 to 27 September 2020.


However, under JobKeeper 2.0, an employer, sole trader EBP or eligible entity with an EBP will not only have to satisfy this test a second time to be entitled to the seven JKPs in Extension Period 1, but will have to satisfy it a third time to be entitled to the six JKPs in Extension Period 2.


The applicable rate of decline in turnover required to qualify for JobKeeper 2.0 is determined in accordance with the existing rules (i.e., 50% for entities with an aggregated turnover of more than

$1 billion, 30% for entities with an aggregated turnover of $1 billion or less and 15% for ACNC- registered charities). Note that, whilst the following discussion is focussed on entities with a required decline of 30%, the underlying principles apply equally to required declines of 50% or 15%.


Extension Period 1


For the purposes of being eligible for JKPs in Extension Period 1 (i.e., 28 September 2020 to 3 January 2021), an entity’s:

  1. actual GST Turnover for the June 2020 quarter must be at least 30% less than its GST turnover for the June 2019 quarter; and

  2. actual GST Turnover for the September 2020 quarter must be at least 30% less than its GST turnover for the September 2019 quarter.

Importantly, and unlike the existing JobKeeper Scheme, the decline in turnover calculations above are based on actual GST turnover. Further, it is important to note that both (a) and (b) must be satisfied. Therefore, if an entity already knows that their June 2020 quarter turnover declined by less than 30% compared to the June 2019 quarter, then it will not be eligible for any further JKPs in Extension Period 1 or 2. This is the case even if there is at least a 30% decline for the September quarter comparison.


Note: All turnover comparisons are made on a quarterly basis, i.e., there are no monthly comparisons under JobKeeper 2.0.


Extension Period 2


For the purposes of being eligible for JKPs in Extension Period 2 (i.e., 4 January 2021 to 28 March 2021), an entity’s:

  1. actual GST Turnover for the June 2020 quarter must be at least 30% less than its GST turnover for the June 2019 quarter;

  2. actual GST Turnover for the September 2020 quarter must be at least 30% less than its GST turnover for the September 2019 quarter; and

  3. actual GST Turnover for the December 2020 quarter must be at least 30% less than its GST turnover for the December 2019 quarter.

As can be seen, the fact that an entity was eligible for JKPs in Extension Period 1 does not mean it is automatically eligible to claim JKPs for Extension Period 2. To do so, it must make a further comparison of its GST Turnover for the December 2020 quarter (as per (c) above).


Also, if an entity was ineligible to claim JKPs for Extension Period 1, it is automatically ineligible to claim JKPs for Extension Period 2. This is the case even if there is at least a 30% decline for the December 2020 quarter comparison. This is because it does not satisfy paragraphs (a) and/or (b) above.


Note: The fact an employer, a sole trader EBP or an eligible entity with an EBP did not make a claim under the existing JobKeeper Scheme does not prevent it from commencing to claim under JobKeeper 2.0 (assuming it satisfies the relevant tests, including the new Decline in Turnover Test).


Alternative turnover tests


The Commissioner will be able to utilise his existing discretion to set out alternative turnover tests where the quarterly comparisons outlined above are not appropriate.