JobKeeper 2.0 New Rules

On 15 September 2020, the legislative instrument for the new JobKeeper 2.0 rules was passed, and further guidance was released to give effect to the following changes to the JobKeeper Scheme which were announced on 21 July 2020 and 7 August 2020, including:

introduction of two Extension Periods for the JobKeeper scheme, beyond the originally planned end date of 27 September 2020, to 28 March 2021;
a two-tier payment rate system after 28 September 2020;
eligibility rules for the two payment tiers, based on the "number of hours worked" by each eligible employee, during one of the two relevant reference periods; and
a requirement to re-test a business's eligibility for the two Extension Periods (ie. the September & December 2020 quarters) based on a new actual "decline in turnover test".

Each of these new changes can be summarised in the following table:

	Extension Period 1	Extension Period 2
Relevant dates?	28 September 2020 to 3 January 2021	4 January 2021 to 28 March 2021
JobKeeper Fortnights?	Fortnights #14 to #20	Fortnights #21 to #26

New rules/tests for the Business/Employer …
New "decline in turnover test"?	The Business will need to confirm it has experienced a decline in "actual GST turnover" (and not projected turnover) for the September 2020 quarter (compared to the September 2019 quarter) …	The Business will need to confirm it has experienced a decline in "actual GST turnover" (and not projected turnover) for the December 2020 quarter (compared to the December 2019 quarter) …
Business with group aggregated turnover more than $1 bn …	.. of at least 50%	.. of at least 50%
Business with group aggregated turnover less than $1 bn …	.. of at least 30%	.. of at least 30%
Charities and ACNC entities …	.. of at least 15%	.. of at least 15%
*Note:* As a part of the new actual "decline in turnover test", the ATO Commissioner has been granted discretion that will determine most (or all) supplies will be treated as being made at a time in the period to which they are attributable for GST reporting purposes – this new discretion has been explained in more detail below the Table.

New rules/tests for Employees/ Business Participants/ Religious Practitioners …
Two-tier payment rates?	Determines the minimum wage each eligible employee, business participant or religious practitioner is paid per fortnight …

High Rate …	$1,200 per Fortnight (when Hours Worked more than 80 hours during the test period)	$1,000 per Fortnight (when Hours Worked more than 80 hours during the test period)
Low Rate …	$750 per Fortnight (when Hours Worked less than 80 hours during the test period)	$650 per Fortnight (when Hours Worked less than 80 hours during the test period)

Number of " Hours Worked "?	This test determines the Payment Rate which will apply to each eligible employee, business participant or religious practitioner during each Extension Period. When the total hours worked during the test period is; more than 80 hours the High Rate applies , and if it is less than 80 hours the Low Rate applies . *Note:* the threshold of 80 hours for the test period* is equivalent to the previous terminology used (ie. 20 hours or more on average per week for a four weeks period).*
For Employees …	The total "hours worked" by each eligible employee (including work performed, paid leave and paid absence on public holidays) in either : the 28-day period ended before 1 March 2020 ; or the 28-day period ended before 1 July 2020 .
For Eligible Business Participants ….	The total "hours actively engaged" by the eligible business participant (including work performed, undertaking specific tasks in business development, planning, regulatory compliance or similar activities) in the month of February 2020 .
For Religious Practitioners …	The total "hours spent doing activities" by the religious practitioner (including in the pursuit of their vocation by performance of the rituals or practices (ie. participation in services, prayer, contemplation or meditation) and furtherance of the objectives of the religious organisation (ie. missionary or charitable work)) in the month of February 2020 .

Wage payment due date extended for JobKeeper Fortnights #14 and #15	As explained above for Extension Period 1, the Business needs to test actual "decline in turnover" for the September 2020 quarter (and this can only be done after 30 September has passed). Consequently, the ATO has extended the "wage payment due date for these two Fortnights until 31 October 2020 , in order to meet the wage condition for all employees included in the JobKeeper scheme. *Note:* JobKeeper Fortnight #14 is from 28 September – 11 October, and Fortnight #15 is from 12 October – 25 October 2020.

We must note that while these announcements give us more guidance in relation to the JobKeeper 2.0 rules (beyond 28 September 2020), further guidance from the ATO is still expected to be released shortly.

Most importantly, we must wait to see some detailed guidance as to how the ATO will allow for alternative reference periods to be used for :

the " decline in turnover test " (where there may be no comparative information available for the September or December 2019 quarters); and

the " number of hours worked test " for determining which of the two-tier payment rates should apply to each eligible employee (where the two reference periods can not give an accurate figure for the number of hours worked, caused by circumstances out of the employee or business's control).

Clarification on calculating "actual GST turnover" for the new actual "decline in turnover test"

As the new actual "decline in turnover test" is based on the actual decline in GST turnover, rather than projected GST turnover, the ATO has been given a more specific power to ensure that the legislation can deliver the intended policy outcomes.

The ATO Commissioner may now determine that certain supplies (ie. transactions) are to be treated as being wholly (or partly) made at a particular time for the purposes of the actual decline in GST turnover test.

Currently, GST turnover is determined based on when supplies are made, not the period to which any tax payable on the supplies is attributable. However, the GST return usually contained in Business Activity Statements ( BAS ) requires reporting of supplies on the basis of attribution.

While this distinction often does not matter over the medium term, in the context of quarterly testing of current GST turnover, it could increase compliance costs for some taxpayers.

We understand that the ATO will accept that most (or all) supplies will be treated as being made at a time during the period to which they are attributable for GST reporting purposes, and this will align the turnover information reported by entities to the ATO in GST returns with how current GST turnover is calculated for the purposes of the new actual "decline in turnover test".

Please do not hesitate to contact your Lowe Lippmann Relationship Partner if you wish to discuss any of these matters further.

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Tax Alert - Further guidance on new proposed changes to Division 296 from 1 July 2026

October 19, 2025

Further guidance on proposed changes to Division 296 from 1 July 2026 Earlier this week, we released a Tax Alert ( click here ) after the Government announced some significant changes to the proposed superannuation rules to increase the concessional tax rate from 15% to an effective 30% rate on earnings on total superannuation balances ( TSB ) over $3 million – known as Division 296. These proposed superannuation rules were set to commence on 1 July 2025, but the Government has now announced significant changes that will delay the start date until 1 July 2026 and apply to the 2026-27 financial year onwards.

Tax Alert - Chalmers backs down on Superannuation reform

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Practice Update – October 2025

October 3, 2025

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