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JobMaker - Is Jobkeeper topup to be included while calculating the base salary?

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Hi

 

We were eligible for Jokeeper during the quarter ended 30 September 2020.  As a result of part time employees receiving Jobkeeper topup payments, our salary for the quarter ended 30 September was higher in comparision to earlier quarters total salary cost.

 

Is the Jobkeeper topup allowance paid to employees to be included in the base salary for the quarter ended 30 September 2020 to check whether there has been an increase in the total salary?

 

Regards

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ATO Community Support

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Hi @AK3,

 

Your baseline value for your payroll is your total payroll paid up within the three months up to and including 6 October 2020.

 

The payroll expenses included in this are:

  • salary and wages
  • all allowances other than a reimbursement of expenses or a fringe benefit
  • overtime, shift and penalties
  • bonuses and commissions
  • amounts withheld under PAYG withholding
  • amounts applied under an effective salary sacrifice arrangement.

Because JobKeeper is an allowance if an employee earns less than the JobKeeper amount, or forms the salary and wages where they earn equal to or above the JobKeeper amount, it is included in your payroll calculation.

 

 

Keep in mind that an employer cannot claim JobKeeper and JobMaker Hiring Credit at the same time. In the transition period, your JobKeeper amounts will count to the payroll figures, though.

4 REPLIES 4

Most helpful response

ATO Community Support

Replies 1

Hi @AK3,

 

Your baseline value for your payroll is your total payroll paid up within the three months up to and including 6 October 2020.

 

The payroll expenses included in this are:

  • salary and wages
  • all allowances other than a reimbursement of expenses or a fringe benefit
  • overtime, shift and penalties
  • bonuses and commissions
  • amounts withheld under PAYG withholding
  • amounts applied under an effective salary sacrifice arrangement.

Because JobKeeper is an allowance if an employee earns less than the JobKeeper amount, or forms the salary and wages where they earn equal to or above the JobKeeper amount, it is included in your payroll calculation.

 

 

Keep in mind that an employer cannot claim JobKeeper and JobMaker Hiring Credit at the same time. In the transition period, your JobKeeper amounts will count to the payroll figures, though.

Newbie

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Hi there, I've just spent a couple of hours on the phone to the ATO as this doesn't make sense to me. I run a small business that had 2 casual and 1 part time employee. I then had to have significant Jobkeeper top up payments. When I hired a new admin staff I don't recall seeing anything about Jobkeeper topups being a part of the baseline amount - has this been added in when the documents were updated in March?  As things stand I have increased my employees from 3 to 5, and the actual pay but because the top up amount for the baseline period was over double the normal wages it looks like we've decreased our wages.  Surely this isn't how the system was designed? I've asked if there was anyone to talk to about this but was informed that there isn't a Jobmaker department so no one to contact directly about this.  As things stand we will have had an extra expense we can't claim the credit for, and I'll now have to go back to tell the employee that we will need to reduce her hours which is something I really don't want to do!

ATO Community Support

Replies 1

Hi @david26

 

JobKeeper has been a part of the baseline payroll since JobMaker was introduced, as it's a form of salary and wages when they earned enough, or a form of an allowance when they have not.

 

Unfortunately, if this means there has not been an increase in both your headcount and your payroll, your business won't be eligible for JobMaker.

 

Our business line handles all JobMaker questions, but they can't change the interpretation of the law and how it's applied.  

Newbie

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Hi Blake, 

the issue isn't with Jobkeeper being included - some of that makes sense. The issue is with the top up amount being included as wages. In real terms my headcount and wages have increased, but because I had a few casual and part time staff the top up amount was a lot.

 

The other things that make this difficult is that there is jobmaker team so I can't direct a complaint to anyone specifically. I've written to several politicians to address this as it seems clearly against the purpose of the scheme.