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JobKeeper 2.0

JobKeeper 2.0

JobKeeper 2.0

The initial JobKeeper Payment program was legislated to run only until 27 September 2020 with no provision for a possible extension. On 21 July 2020, the Government announced a modified version of JobKeeper Payment, dubbed 'JobKeeper 2.0', which will run from 28 September 2020 until 28 March 2021.

The extended JobKeeper program has not yet been legislated and there are a lot of unknowns about how JobKeeper 2.0 will operate.


In light of the lockdown in Victoria, the government has reconsidered and relaxed the eligibility criteria for the proposed JobKeeper extension. We have therefore updated this article to reflect the new information.

Broadly, to qualify for the JobKeeper payment for the period from 28 September 2020 to 3 January 2021, the reduction in turnover test will now need to be met only for the September 2020 quarter (as compared to the September 2019 quarter).

To qualify for the JobKeeper payment for the period from 4 January 2021 to 28 March 2021, the reduction in turnover test will now need to be met only for the December 2020 quarter (as compared to the December 2019 quarter).

Additionally, eligible employees will be re-defined to include employees engaged after 1 March 2020 and before 1 July 2020.

Please also note that updated factsheets have been released by Treasury and can be accessed here.

Here is what we know so far:

  • The extended JobKeeper will be notionally divided into Phase 1 (28 September 2020 to 3 January 2021) and Phase 2 (4 January 2021 to 28 March 2021).
  • The payment rates will be reduced under each phase from the current $1,500 per fortnight per eligible employee rate and, depending on the hours worked by eligible employees in February 2020, they may be eligible for either the full or the partial rate:
  • To determine whether the full or the partial rate will apply, businesses will need to consider the average hours worked (in the case of eligible employees) or average hours of being actively engaged in the business (in the case of eligible business participants - i.e. sole traders or individuals running a business via a partnership, trust or company) during February 2020:


  • The number of work hours will have no impact on JobKeeper Payments up to 27 September 2020.
  • From 28 September 2020, employees whose work hours decreased from 20 hours or more per week on average to fewer than 20 hours per week after February 2020 will still remain entitled to the full payment rate regardless of the hours they actually work.
  • From 28 September 2020, business participants who, in February 2020, worked in their business for less than 20 hours per week (average) but have since increased their active participation due to the crisis will not qualify for the full payment rate regardless of how many hours they work in their business.

Changes to eligibility rules under JobKeeper 2.0

  • From 28 September 2020, to qualify for the JobKeeper Payments, businesses will have to qualify for each phase based on the decline in their actual turnover for each of the 2 or 3 recent quarters compared to the prior year equivalent periods. The exact rules will differ for each phase. UPDATE 7 AUGUST: under the revised proposal, the decline in turnover test will only need to be satisfied for the immediately preceding quarter:
  • The required decline in turnover to qualify for JobKeeper 2.0 remains at 30% for most businesses and 15% for most Not-For-Profits.
  • A business would have to separately qualify for Phase 1 payments and then for Phase 2 payments.
  • To qualify for Phase 1 and 2 payments, an entity would need to meet the 30% decline in turnover test for each of the quarters listed in the table (i.e. each quarter is tested separately, and not in aggregate).
  • Businesses and Not-For-Profits will generally be able to assess eligibility based on details
    reported in the Business Activity Statement (BAS). Alternative arrangements will be put in place for businesses and Not-For-Profits that are not required to lodge a BAS. It is not clear yet whether organisations will be strictly limited to the calculation method chosen in their BAS (i.e. cash or accruals) or whether there will be scope to adopt an alternative method in appropriate circumstances, however initial guidance from Treasury suggests that BAS figures will be need to be used.
  • The deadline to lodge the September BAS is due in late October, and the December BAS is due in late January (monthly) or late February (quarterly). Therefore businesses will need to assess their JobKeeper eligibility in advance of the BAS deadline in order to meet the wage condition.
  • UPDATE 7 AUGUST: the definition of eligible employees will be revised to include employees engaged as at 1 July 2020, so that employers can receive JobKeeper payments in respect of employees they've hired between 1 March and 1 July 2020.

While the new JobKeeper 2.0 sounds relatively straightforward based on the information available so far, the devil is always in the detail and that is yet to come. We await the legislation and ATO publications which will follow.

It is expected that these will clarify what ATO discretions or alternative tests may be available for taxpayers whose circumstances are complex or unusual. However, most businesses will face much stricter eligibility criteria after 27 September 2020 with two additional testing points (for Phase 1 and Phase 2) and reduced JobKeeper payments compared to the current level of assistance.


We are concerned that the requirement to satisfy the decline in turnover test for the June, September and December 2020 quarters may result in businesses that have been doing relatively well so far but are now starting to suffer, becoming ineligible for continued JobKeeper support when they need it most.

With Victoria, and Melbourne in particular, going into a lockdown for six weeks as announced on 3 August, the impact on other businesses around the country may be significant. In light of this, the Government may re-visit the JobKeeper 2.0 eligibility rules to reflect the impact of the Victorian lockdown on the expected economic recovery.

Given the importance of the JobKeeper subsidy to the business sector, it is essential that business owners continue to keep abreast of new developments in this area. We will continue to update our COVID-19 Info Hub and in particular our Breaking News page as further details emerge.

UPDATE 7 AUGUST: As we had hoped, the government announced the more relaxed eligibility conditions for JobKeeper 2.0. The result is that businesses that experience a significant decline in revenue in the later part of the year compared to the earlier part of the year, will be more likely to qualify for the JobKeeper payments.

Further information

You can find additional information by accessing the Treasury factsheet.

As always, we are here to assist you with any JobKeeper questions you may have and encourage you to get in touch with your Ruddicks adviser if you wish to discuss any issues raised in this article.


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The content of this newsletter is general in nature. It does not constitute specific advice and readers are encouraged to consult their Ruddicks adviser on any matters of interest. Ruddicks accepts no liability for errors or omissions, or for any loss or damage suffered as a result of any person acting without such advice. This information is current as at 30 July 2020, and was published around that time. Ruddicks particularly accepts no obligation or responsibility for updating this publication for events, including changes to the law, the Australian Taxation Office’s interpretation of the law, or Government announcements arising after that time.

Any advice provided is not ‘financial product advice’ as defined by the Corporations Act. Ruddicks is not licensed to provide financial product advice and taxation is only one of the matters that you need to consider when making a decision on a financial product. You should consider seeking advice from an Australian Financial Services licensee before making any decisions in relation to a financial product. © Ruddicks 2020

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