JobKeeper Payment 2.0... the final phase!

To continue receiving JobKeeper payments between 4 January 2021 and 28 March 2021, employers will need to re-assess their eligibility to continue into Extension Period 2. You will need to demonstrate a significant decline in actual GST turnover using the " Basic Test " comparing the December 2020 quarter to the December 2019 quarter.

If you do not satisfy the decline in turnover test using the Basic Test, you can consider the various Alternative Tests which we have explained in detail in previous Tax Alerts:

Alternative Test categories 1 to 7 – click here
Alternative Test category 8 – click here

Extension Period 2

The full details of Extension Period 2 have been summarised in the following table:

Extension Period 2
Relevant dates?	4 January 2021 to 28 March 2021

JobKeeper Fortnights
JobKeeper Fortnights?	Wage Payment Date? (ie. date employees must be paid on or before)
FN #21 - 4 January 2021 – 17 January 2021	31 January 2021 **
FN #22 - 18 January 2021 – 31 January 2021	31 January 2021
FN #23 - 1 February 2021 – 14 February 2021	14 February 2021
FN #24 - 15 February 2021 – 28 February 2021	28 February 2021
FN #25 - 1 March 2021 – 14 March 2021	14 March 2021
FN #26 - 15 March 2021 – 28 March 2021	28 March 2021
Note:** JobKeeper Fortnight #21 has been given an extended Wage Payment Date, to provide additional time for a business to perform their "decline in turnover test" and ""80 hour test" analysis – both are explained below.

"Decline in turnover tests" for the Business/Employer …

Basic Test period for " 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 December 2020 quarter (compared to the December 2019 quarter) …
Business with group aggregated turnover more than $1 bn …	.. of at least 50%
Business with group aggregated turnover less than $1 bn …	.. of at least 30%
Charities and ACNC entities …	.. of at least 15%

If you do not satisfy the decline in turnover test using the Basic Test, you can consider the various Alternative Tests which we have explained in detail in previous Tax Alerts: • Alternative Test categories 1 to 7 – click here • Alternative Test category 8 – click here

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 …
Tier 1 - High Rate …	$1,000 per Fortnight (when Hours Worked more than 80 hours* during the test period)*
Tier 2 - Low Rate …	$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 .
*Note:* In some circumstances, an alternative reference period can be applied for the "80 hour test" if the standard reference period is not suitable.

Wage payment due date extended for JobKeeper Fortnight #21 (4 January 2021 – 17 January 2021)	As explained above for Extension Period 2, the Business needs to test actual "decline in turnover" for the December 2020 quarter (and this can only be done after 30 December 2020 has passed). Consequently, the ATO has extended the "wage payment due date for Fortnight 21 until 31 January 2021 , in order to meet the wage condition for all employees included in the JobKeeper scheme.

New Participants (who have not enrolled yet)

If you have not enrolled for the JobKeeper Payment scheme until now, you will need to complete the following actions by the end of the month that you wish to claim for:

Enrol for the JobKeeper Payment (be aware that it may take the ATO up to 3 days to process before you can submit your decline in turnover form and identify your eligible employees).
Submit your decline in turnover form.
Identify your eligible employees or business participant and tell us whether the tier 1 (high rate) or tier 2 (low rate) payment rate applies to them – the payment rates are detailed in the table above.

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

October 13, 2025

In response to continuing criticism and significant industry feedback, Treasurer Jim Chalmers has announced substantial revisions to the proposed Division 296 tax. The government has decided not to apply the tax to unrealised capital gains on members superannuation balances above $3 million. The removal of the proposed unrealised capital gains tax is undoubtedly a welcome change. Division 296 was initially set to take effect from 1 July 2025. The revised proposal, effective from 1 July 2026, still imposes an additional tax but now only on realised investment earnings on the portion of a super balance above $3 million at a 30 percent tax rate To recover some of the lost tax revenue, the Treasurer announced a new 40 percent tax rate on earnings for balances exceeding $10 million. It is also anticipated that both tax thresholds will be indexed in line with the Transfer Balance Cap. We will provide more details and guidance on the new proposal as they become available.

Practice Update – October 2025

October 3, 2025

ATO interest charges are no longer tax deductible – What you can do As we explained in our Practice Update for September, general interest charge ( GIC ) and shortfall interest charge ( SIC ) imposed by the ATO is no longer tax-deductible from 1 July 2025. This applies regardless of whether the underlying tax debt relates to past or future income years. With GIC currently at 11.17%, this is now one of the most expensive forms of finance in the market — and unlike in the past, you won’t get a deduction to offset the cost. For many taxpayers, this makes relying on an ATO payment plan a costly strategy. Refinancing ATO debt Businesses can sometimes refinance tax debts with a bank or other lender. Unlike GIC and SIC amounts, interest on these loans might be deductible for tax purposes, provided the borrowing is connected to business activities. While tax debts will sometimes relate to income tax or CGT liabilities, remember that interest could also be deductible where money is borrowed to pay other tax debts relating to a business, such as: GST; PAYG instalments; PAYG withholding for employees; and FBT. However, before taking any action to refinance ATO debt it is important to carefully consider whether you will be able to deduct the interest expenses or not. Individuals If you are an individual with a tax debt, the treatment of interest expenses incurred on a loan used to pay that tax debt really depends on the extent to which the tax debt arose from a business activity: Sole traders: If you are genuinely carrying on a business, interest on borrowings used to pay tax debts from that business is generally deductible. Employees or investors: If your tax debt relates to salary, wages, rental income, dividends, or other investment income, the interest is not deductible. Refinancing may still reduce overall interest costs depending on the interest rate on the new loan, but it won’t generate a tax deduction.