Service NSW recently released some further guidance on the JobSaver scheme which is now available to impacted businesses in NSW. Today the Prime Minister announced an expansion to the scheme to include additional support for more businesses.

Payments under the scheme

Eligible businesses with an aggregated turnover of up to $250 million can receive an equivalent of 40% of their weekly payroll up to a maximum of $100,000 per week for the duration of the restrictions from 18 July 2021. Previously, businesses needed to have a aggregated turnover of less than $50 million and the maximum payment amount was $10,000 per week. For non-employing businesses (e.g. sole traders), the amount is set at $1,000 per week. These amounts will be paid fortnightly.

Weekly payroll is calculated in reference to the W1 figure on the last lodged business activity statement before 26 June 2021 relating to the 2020-2021 financial year. Amounts voluntarily withheld on behalf of contractors are excluded from the calculation.

Eligible non-employing businesses can apply for fortnightly payments of $1,000 per week for the period from 18 July 2021 for the duration of the restrictions in the Public Health Order or as prescribed in the Program Guidelines.

Once an application has been approved, a business or not-for-profit organisation will receive automatic fortnightly payments credited to their nominated bank account. The first payment will be backdated to 18 July 2021 and, where possible, will be made within 10 business days of an approved application.

Eligibility criteria

Depending on whether or not the business is an employing business, the eligibility criteria are as follows:

  Employing business Non-employing business
ABN requirements The business or not-for-profit organisation 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. Evidence may include commercial rates notices or lease agreements. Where a rates notice or lease agreement is not available, Service NSW may accept one or more of the following documents: 
(a) utility bills
(b) insurance papers, 
(c) supply invoices, 
(d) registration papers, or
(e) contractor licences.
Turnover threshold National aggregated annual turnover between $75,000 and $250 million (previously $50 million). National aggregated turnover includes the turnover of the entity and any entities connected or affiliated with it. Please note while aggregated turnover is defined in the Tax Act, "national aggregated turnover" is not. We assume the test excludes foreign connected entities however we are currently clarifying this with Service NSW.
Decline in turnover The business has experienced a decline in turnover of 30% 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. However, we note that the application form states the period is between 26 June 2021 and 14 August 2021, we are currently clarifying this with Service NSW.

For the purposes of the Program, turnover takes its definition from the GST Act. Our understanding it that you are only required to include a supply in your turnover when the supply is made and it may be slightly differently to how sales are reported on the business activity statement (which could be based on cash or accrual reporting). Please also note that certain supplies included in 'Total Sales' in the business activity statement would fall outside the definition of GST turnover (e.g. input taxed supples).

In our dealings with Service NSW in relation to the business grant, they have been assessing eligibility based on how you report it on the business activity statement which is slightly different to how the guidelines are written for the JobSaver scheme. We are awaiting confirmation from Service NSW in relation to this. 
Employee headcount The business maintains its Employee Headcount while they continue to receive payments under the Program. Employee Headcount means the total number of persons employed in New South Wales and who are permanent (full-or part time) or casual staff who have been employed for more than twelve months by the business or not-for-profit organisation as at 13 July 2021.

Note, if the Employee headcount reduces for reasons outside the business' control, it will not make the business ineligible for the payment e.g. an employee who voluntarily resigns. Employees who have been stood down under the Fair Work Act 2009 or take leave without pay are considered employees for the purpose of the headcount.
Income source N/A The business is the primary income source for its owner.
Two or more non-employing businesses N/A 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.
Other N/A No persons associated with the business, and who derive income from it, have received a Commonwealth COVID-19 Disaster Payment since 18 July 2021.

Ineligible entities

The following entities are not eligible to receive JobSaver payments:

  • the Major Bank Levy was imposed on the business or a member of its consolidated group for any quarter before 1 July 2021
  • the business is an Australian government agency (within the meaning of the Income Tax Assessment Act 1997)
  • the business is a state or local governing body
  • the business is wholly owned by an Australian government agency or local governing body
  • the business is a sovereign entity or owned by a sovereign entity
  • the business is a company in liquidation or provisional liquidation
  • the business is an individual who has entered bankruptcy
  • the business has been found to have been engaged in fraud
  • the business primarily earns passive income (rent, interest, or dividends)
  • the business is a Table A provider within the meaning of the Higher Education Support Act 2003, and
  • the business registered its Australian Business Number (ABN) after 1 June 2021, or a business that has backdated its ABN to before 1 June 2021 for the purposes of eligibility.

Alternate Tests

Businesses who cannot meet the decline in turnover requirement due to their own specific circumstances may still be eligible for the payments but will need to contact Service NSW to determine an alternate comparison period. These circumstances may include the following situations:

(a) the business was not operating for the full year to 30 June 2020 (e.g. new businesses)
(b) the business was affected by drought, bushfires or other natural disasters
(c) business acquisition, disposal, or business restructure that has impacted the business's turnover, or
(d) a sole trader or small partnership impacted by sickness, injury or leave.

Evidence requirements

Depending on whether or not the business is on a highly impacted list, the evidence requirements may be slightly different. Refer here, for a list of the highly impacted businesses.

  Business in highly impacted list Business not in highly impacted list
Decline in turnover Declare that they experienced the Required Decline in Turnover. Submit evidence that they experienced the Required Decline in Turnover. A letter from an independent tax agent/accountant would be required for these businesses.

If you have already submitted a letter from an independent tax agent/accountant to access the COVID-19 business grant, you can resubmit this letter.

Employee headcount Declare their Employee Headcount and that they will maintain their Employee Headcount for the period for which the business is receiving payments under the Program and notify Service NSW if there is any reduction in Employee Headcount during that period, where the reduction is due to circumstances outside of its control, for example, if the employee voluntarily resigns or retires.
Primary source - non-employing businesses only For a non-employing business, declare that the business is the primary income source for the owner.
Tax returns Submit an Australian income tax return (or Notice of Assessment) or other documentation to demonstrate the business or not-for-profit organisation had a national Aggregated Annual Turnover of between $75,000 and $50 million (inclusive) for the year ended 30 June 2020, however there is no requirement to disclose tax file numbers and businesses should redact their tax file number where possible.

If the entity applying is a trust, additional information will be required to show that the national Aggregated Annual Turnover is derived through the trust.
Accountant's details Provide details of their Independent Practitioner for compliance checking.
Payroll evidence Submit evidence of weekly Payroll
  • for businesses and not-for-profit organisations that submit a BAS with a W1 amount (wages and salaries) recorded: their most recent BAS that was submitted to the ATO prior to 26 June 2021 within the 2020-21 financial year. 
  • for businesses and not-for-profit organisations that submit a BAS without a W1 amount (wages and salaries) recorded: their 2019-20 NSW payroll tax reconciliation return.
  • for businesses and not-for-profit organisations that do not submit a BAS, contact Service NSW to discuss alternate evidence of wages and salaries.
Other supporting documents Submit other supporting documents as required to demonstrate that they meet the eligibility.

Eligible expenses

As part of the conditions for payments made under the program, the business must use the funds to cover "Eligible expenses" incurred since 18 July 2021. Eligible expenses are those made to help maintain a business' NSW employee headcount, including, but not limited to, the following expenses:

  • salaries and wages
  • utilities and rent
  • financial, legal or other advice
  • marketing and communications
  • perishable goods
  • other business costs.

Next Steps

Applications are now open and close on 18 October 2021. We are happy to assist you with the applications and suggest you contact us to determine whether your business is eligible for these payments.

The material contained in this publication is in the nature of general comment and information only and is not advice. The material should not be relied upon. Please contact your local Moore Australia office to discuss your specific circumstances or case. Moore Australia, any Australian Member, any related entity of those persons, or any of their officers employees or representatives, will not be liable for any loss or damage arising out of or in connection with the material contained in this publication.