Upon Royal Assent, the ATO will publish extensive guidance on many aspects of JobKeeper, such as the eligibility criteria, how to apply, how it is paid (instalments or as a lump sum), the payment timetable and applicable conditions.
"The JobKeeper package has vested important and extensive powers in the Commissioner of Taxation, effectively turning the ATO into a giver, rather than a taker," said CA ANZ's Australian Tax Leader Michael Croker.
"The legislation has claw-back rules empowering the ATO to recover overpaid amounts and target those who weren’t entitled to payments received, plus interest."
The legislation says pre-payment record keeping requirements must be kept by applicants for 5 years unless excused by the Commissioner and outlines ongoing record-keeping obligations after the JobKeeper payment has been received.
"It's so important not to blindly go after the money without some evidence of the economic impact of COVID-19 on business turnover," said Mr Croker.
"Employers should get ready and get set before they go."
"Business cashflow planning is also essential. Cash goes out the door before JobKeeper payments come in. The sad reality is JobKeeper will not be enough to save every business."
Mr Croker also said employers need to wary about who they get their advice from.
"Inevitably there'll be shonks touting contrived schemes designed to exploit JobKeeper. However the legislation empowers the Commissioner to call out 'any change in the financial position of any entity' as part of a scheme designed to improperly pocket JobKeeper cash and the ATO has extensive payback powers."
"Employees will be the ATO's eyes and ears. Changes to the Fair Work Act impose a 'flow-through' obligation so that JobKeeper money flows from employer to employee. The ATO dob-in hotline will be busy where employers do the wrong thing."
Mr Croker said employers need to quickly develop a JobKeeper employee response plan.
"Employees will have so many questions for the boss, ranging far beyond the simple 'how much do I get and when do I get it'?"
"In some situations, employers will need to deliver bad news to those excluded from JobKeeper. Employees who've already been stood down may now ask their former boss about the possibility of re-hiring arrangements."
"Eligible employees will want to know how their employment arrangements will be changed: their hours, adjusted salary and entitlements."
"Depending on the business' circumstances, 'JobKeeper enabling stand down' arrangements and 'JobKeeper enabling directions' may need to be designed and communicated to employees.
"To cope with all these questions, accountants and employers will need to develop a working understanding of the temporary changes which the legislation makes to the Fair Work Act."
Mr Croker also urged employees to be careful and not get caught out by scammers promising cash and seeking bank account details."
"Look for official JobKeeper communications from your employer and the ATO via trusted channels. Always call and check if in doubt."
"Our members are already flat out helping businesses across the nation get through COVID-19 and JobKeeper means they'll really be burning the midnight oil now."
Mr Croker said the CA ANZ Tax Team would also be working hard over coming weeks clarifying aspects of the JobKeeper program with the ATO.
COVID-19 Resources Hub
CAs and their clients can access information about a range of COVID-19 measures, including the JobKeeper package.COVID-19 Resources hub
Federal Government coronavirus economic stimulus stage 3
Measures include subsidies to support telehealth services, mental health support, community support and employees and businesses - the JobKeeper payment.Find out more