ATO, Australian Government, Industry News

COVID-19 JobMaker Hiring Credits Eligibility Criteria

By Paolo Coniglio, 30.12.2020

JobMaker Employees

JobMaker Eligibility – Employer

Employers will need to meet two separate sets of eligibility criteria: the first to be granted into the scheme and a second set (defined as ‘Job Creation’ criteria) to receive the quarterly hiring credits. This last set of criteria is reviewed each quarter by the ATO when the subsidy claim is lodged.

Criteria to enter the Scheme

What type of employers are eligible?

Qualifying employers must meet the following criteria:

  • Be a Private Entity (Sole Trader, Trust, Partnership or Company), Not for Profit or Deductible Gift Recipient;
  • Have an active ABN as of the start date of their JobMaker Registration;
  • Be registered for PAYG Withholding;
  • Report their Payroll through Single Touch Payroll;
  • Have no outstanding Tax or GST Returns;
  • Have at least one active employee.

What type of employers are not eligible?

Employers are not entitled to enter the JobMaker scheme if:

  • They are an Australian Government Agency or local governing body;
  • They are entities (including Sole Traders and Partnerships) in liquidation, provisional liquidation or bankruptcy;
  • Have outstanding Tax or GST Returns within the last 2 years;
  • They are claiming the JobKeeper subsidy payment for a fortnightly period that started during the JobMaker period.

Job Creation Eligibility Criteria

To be able to receive the quarterly Hiring Credits for their eligible employees, Employers must be able to prove that:

  • Their quarterly employee headcount has increased compared to a previous period;
  • Their quarterly payroll cost has also increased, compared to a previous period.

More detailed information on how the Job Creation Criteria is covered further in the blog.

ATO Fact Sheet – JobMaker Hiring Credits Eligibility

JobMaker Eligibility – Employees

Eligible Employees

Eligible employees must meet the following criteria:

  • Be between the age of 16 to 35 years old;
  • Have received, for at least 28 consecutive days within 84 days before commencing the new employment, one of the following income support subsidies*:
    – Parenting Payments;
    – Youth Allowance;
    – JobSeeker.
    * Employees can include eligible days where the income support payment was Nil
  • Are not receiving JobMaker or JobKeeper payment subsidies from another employer;
  • Have started employment between 7th October 2020 and the 6th October 2021 (inclusive);
  • Are hired as employees (Full-Time, Part-Time or Casuals), not subcontractors;
  • Are working an average of at least 20 hours for each whole week of employment* for the employer applying for the JobMaker Hiring Credits.
    * Includes Paid Leave and Paid absence on Public Holidays

Non-Eligible Employees

The following employees are not eligible for the JobMaker Hiring Credits:

  • Employees previously employed as subcontractors by the applying entity between the 7th April 2020 and the 6th October 2020;
  • Relatives of the Sole Trader;
  • Partners in a Partnership or close associates* to one of the Partners;
  • Trustees or a Beneficiaries of the Trust, or close associates* to one of the Trustees;
  • Shareholders or a Director of the Company or close associates* to the Director or one of the Shareholders.
    * “Close associate” is a term newly introduced by paragraph 4AA of the JobMaker Rules and is defined to mean a “relative” of any of the ineligible individuals listed above. As described in the Explanatory Statement to the Coronavirus Economic Response Package (Payments and Benefits) Amendment Rules (No. 9) 2020, “relative” is defined in subsection 995-1(1) of the Income Tax Assessment Act 1997 (“ITAA97”) to be one of the following:
    • the person’s spouse;
    • the parent, grandparent, brother, sister, uncle, aunt, nephew, niece, lineal descendent or adopted child of that person, or of that person’s spouse;
    • the spouse of the parent, grandparent, brother, sister, uncle, aunt, nephew, niece, lineal descendent or adopted child of that person, or of that person’s spouse.

ATO Fact Sheet – JobMaker Hiring Credits for Employees

Register for the JobMaker Hiring Credit

Eligible Employers must register their intention to participate in the JobMaker Hiring Credit at any time, even before they hire any eligible employees. Registration to the scheme was opened on 6th December 2020. More information on the Registration and Claim process is available on our other JobMaker blog.

References

https://www.ato.gov.au/General/JobMaker-Hiring-Credit/

https://www.ato.gov.au/General/JobMaker-Hiring-Credit/In-detail/Fact-sheets/

https://www.ato.gov.au/General/JobMaker-Hiring-Credit/JobMaker-Hiring-Credit-key-dates/

https://www.ato.gov.au/General/JobMaker-Hiring-Credit/Keeping-JobMaker-Hiring-Credit-fair/

https://ministers.treasury.gov.au/ministers/josh-frydenberg-2018/media-releases/jobmaker-hiring-credit-passes-parliament

https://budget.gov.au/2020-21/content/factsheets/hiring-credit.htm

Disclaimer

This blog and attached resources are of general nature designed for informational and educational purposes only. They should not be construed as professional financial advice for your individual business. Should you need such advice, consult a licensed financial or tax advisor.

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