JobSaver Payment & Micro Business Grant

Updated based on the information released on Service NSW website as of 6pm on 25 July 2021.

The following programs are expected to open on 26 July and close on 18 October 2021.

JobSaver Payment: $1,500 to $10,000 per week non-taxable payment from 18 July 2021

Application Link: https://www.service.nsw.gov.au/transaction/jobsaver-payment Guidelines: https://www.service.nsw.gov.au/jobsaver-payment-guidelines

Terms & Conditions: https://www.service.nsw.gov.au/jobsaver-payment-terms-and-conditions

Micro business grant: $1,500 per fortnight non-taxable backdated to 26 June 2021 Application Link: https://www.service.nsw.gov.au/transaction/2021-covid-19-micro-business-grant

Guidelines: https://www.service.nsw.gov.au/2021-covid-19-micro-business-grant-guidelines

Terms & Conditions:https://www.service.nsw.gov.au/2021-covid-19-micro-business-grant-terms-and-conditions

JobSaver Payment

JobSaver Eligibility & Use of Funding

1. An employing business or not-for-profit organization may be eligible for a payment if it:

• has an Australian Business Number (ABN) registered in New South Wales, or it can demonstrate it was operating in New South Wales, as at 1 June 2021;

• had a national Aggregated Annual Turnover of between $75,000 and $50 million (inclusive) for the year ended 30 June 2020;

• experienced a decline in turnover of 30 per cent or more due to the Public Health Order over a minimum two-week period from 26 June 2021 to 30 July 2021 compared to the same period in 2019 (“Required Decline in Turnover”); and

• maintains its Employee Headcount as of 13 July 2021 while they continue to receive payments under the Program.

2. A Non-employing Business may be eligible for a payment if:

• the business is the primary income source for its owner;

• has an Australian Business Number (ABN) registered in New South Wales, or it can demonstrate it was operating in New South Wales, as at 1 June 2021;

• had a national Aggregated Annual Turnover of between $75,000 and $50 million (inclusive) for the year ended 30 June 2020;

• experienced a decline in turnover of 30 per cent or more due to the Public Health Order over a minimum two-week period from 26 June 2021 to 30 July 2021 compared to the same period in 2019 (“Required Decline in Turnover”); and

• where an individual owns or operates more than one non-employing business, an application for payment is made in respect of one non-employing business only;

• no persons associated with the business, and who derive income from it, have received a Commonwealth COVID-19 Disaster Payment since 18 July 2021.

3. Businesses that weren’t eligible for the NSW 2021 COVID-19 business grant may still be eligible for the JobSaver payment. Certain entities, such as those earning passive income (rents, interest, or dividends), are not eligible for JobSaver.

4. Business that are in alternative circumstances listed in the guidelines should contact Service NSW to determine if an alternate comparison period can be applied.

5. Eligible organizations will receive fortnightly payments backdated to cover costs incurred from 18 July. The JobSaver payments will help cover their business costs including but not limited to: salaries and wages, utilities and rent, financial, legal and other advice, marketing and communications, perishable goods or other business costs.

JobSaver - Requirement to maintain employee headcount

6. According to the Guidelines, maintaining their Employee Headcount means the employer will not take active steps to end the employment relationship with their employees. Employees who have been stood down under the Fair Work Act 2009 or take leave without pay are still considered employees for the purpose of headcount. Businesses will remain eligible if their employee headcount declines for reasons outside the control of the employer, for example if employees voluntarily resign.

7. Despite being eligible under JobSaver, employers when standing down employees, are recommended to check their employment agreements and seek advice from an employment lawyer or employee representative body to ensure their action accords with employment agreements they have.

Employee Disaster Payment Entitlement / Employer JobSaver Eligibility

8. Employees can receive Commonwealth COVID-19 Disaster Payments if their employer is receiving JobSaver.

9. Non-employing businesses are not eligible for the JobSaver payment if individuals associated with and deriving income from the business have received a Commonwealth COVID-19 Disaster Payment since 18 July 2021.

10. The Guidelines have not provided clear answer as to whether an employing business’ eligibility to get JobSaver payment will be affected if individuals associated with and deriving income from the business have received a Commonwealth COVID-19 Disaster Payment since 18 July 2021. If this is applicable to you, we recommend you contact Service NSW to seek clarification before the individuals claim the Disaster Payment. JobSaver Application Process

11. Please refer application link at the beginning of the letter. Businesses that have applied and are eligible for the 2021 COVID-19 business grant will generally be automatically eligible for JobSaver. If businesses have previously submitted a letter from a qualified accountant, registered tax agent or registered BAS agent to Service NSW to verify decline in turnover for other COVID-19 business support grants, they can resubmit this letter as evidence of a decline in turnover up to the percentage previously attested.

12. In addition to above, you will be required to make declarations, provide evidence of Weekly payroll and may be requested to provide tax return and BAS documents.

13. Once deemed eligible, businesses will receive automatic fortnightly payments. Businesses will not need to re-apply but must notify Service NSW if they are not maintaining the number of employees they had on 13 July 2021. Reductions in employee headcount resulting from circumstances outside the control of the employer (such as voluntary resignations, death of an employee) will not be taken as a reduction in employee headcount on 13 July.

14. You may be required to submit Tax Agent details

Loewy Consulting Partners Pty Ltd

Tax Agent Number: 2569 6194

Tel: 02 9362 3332

JobSaver - How to calculate Weekly payroll & JobSaver Payment

15. JobSaver payments are equivalent to 40% of Weekly Payroll for work performed in New South Wales and will be at minimum $1,500 and maximum $10,000 per week. Non-employing business may be eligible to receive a payment of $1,000 per week.

16. Weekly Payroll should generally be determined by referring to the calculations underlying the most recent Business Activity Statement provided to the Australian Taxation Office prior to 26 June 2021 for the 2020-21 financial year. Item W1 in the BAS includes amounts of wages, salaries and other payments that are subject to PAYG withholding tax as defined by the ATO.

Please refer the table below for example

17. For the purposes of calculating Weekly Payroll, employers should identify W1 amount and Include allowances, leave loading, director fees and termination payments, but Excludes payments such as superannuation contributions, amount subject to salary sacrifice, interest, dividends, amounts withheld on behalf of contractors under voluntary agreements, or (for businesses that also operate in other states or territories) payments to employees usually worked or were based outside New South Wales.

Micro Business Grant

Micro business grant - Eligibility & Use of Funding

18. A business or not-for-profit organisation may be eligible for payment under the Program if:

• they have an Australian Business Number (ABN) registered in, or can demonstrate they are primarily operating in, New South Wales, as at 1 June 2021;

• they had a national Aggregated Annual Turnover of more than $30,000 and less than $75,000 for the year ended 30 June 2020;

• they experienced a decline in turnover of 30 per cent or more due to the Public Health Order over a minimum two-week period between 26 June 2021 and 30 July 2021, compared to the same period in 2019;

• they have business costs for which there is no other government support available;

• they have not applied for either the 2021 COVID-19 Business Grant, or the JobSaver scheme;

• for Employing businesses, they maintain their Employee Headcount as at 13 July 2021 while they continue to receive payments under the Program;

• for Non-employing Businesses, the business receiving payments must be the primary income source for the associated person;

• they are able to provide sufficient evidence to demonstrate that it meets the above eligibility criteria

19. Where an individual owns more than one Non-employing Business, an application for payment must only be made in respect of one Non-employing Business.

20. Certain entities, such as those primarily earning passive income (rents, interest, or dividends) or those with an ABN registered after 1 June 2021 are not eligible for this Grant.

21. The Grant will help eligible micro-businesses with costs incurred from 1 June 2021 such as salaries and wages, utilities and rent, financial, legal and other advice, marketing and communications, perishable goods or other business costs. The Grant must only be used for expenses for which no other government support is available.

22. Business that are in alternative circumstances listed in the guidelines should contact Service NSW to determine if an alternate comparison period can be applied.

Employing micro-business entities are required to maintain employee headcount

23. Rules are similar to JobSaver refer points 6 and 7. Employee Disaster Payment Entitlement / Micro Business Grant Eligibility

24. Rules are similar to JobSaver refer points 8,9,and 10.

Micro business grant Application Process

25. Please refer application link at the beginning of the letter. You will be required to make declarations and submit evidence such as tax return, BAS, or accountant letter.

26. Once deemed eligible, businesses will receive automatic fortnightly payments. Businesses will not need to re-apply, but businesses with employees must notify Service NSW if they are not maintaining the number of employees they had on 13 July 2021.

27. You may be required to submit Tax Agent details

Loewy Consulting Partners Pty Ltd

Tax Agent Number: 2569 6194

Tel: 02 9362 3332

NSW government has a right to audit

28. By applying for JobSaver or the Micro business grant, applicants agree their application may be subject to an audit by the NSW Government or its representatives and agree to participate in the process if required. Service NSW and Revenue NSW may use other data provided by applicants to other government agencies to assist with determining eligibility. A public reporting channel will be established to allow people to report businesses not adhering to micro business grant guidelines.

29. While JobSaver payments can be used to cover general business costs, the primary objective of this payment is to help businesses to survive, maintain relationships with their employees and be in a position to trade when restrictions are lifted.

30. We address the importance of maintaining accurate business turnover & other appropriate records, and carefully conducting Weekly Payroll calculations & applicable adjustments for verification purposes. You’ll need to keep all documentary evidence relied upon in your application for a minimum of 5 years. The onus on any claim rests with the taxpayers seeking the relief.

Important: Clients should not act solely on the basis of the material contained in this newsletter. Items herein are general comments only and do not constitute or convey advice per se. Also changes in legislation may occur quickly. We therefore recommend that our formal advice be sought before acting in any of the areas. Client Alert is issued as a helpful guide to clients and for their private information. Therefore it should be regarded as confidential and not be made available to any person without our prior approval.