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Re: Jobkeeper Sole Trader Monthly Declaration

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I am a sole trader with no employees who experienced more than 30% turnover reduction for March 2020 compared to March 2019. This has been due to the fact that business has been cancelled and a number of clients have been unable to pay invoices I have submitted to them. I did not receive any income in the first fortnight of April but then received payments against a backlog of invoices for the second fortnight which now means I have not had a 30% reduction in turnover when comparing April 2020 to April 2019. If this happens again in May, the same will happen (i.e no longer a 30% reduction). However, the remainder of the year looks fairly grim with little to no income projected for June-September at this stage. Do I qualify for Fortnight 1 and Fortnight 2 of April month, based on the fact that March turnover was more than 30% reduction? 

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Most helpful response

Former Community Support

Replies 1

Hi @Michelle72,

 

Thanks for reaching out to us.

 

Our website has some helpful information under Sole traders. Have a look at the information how to determine an actual decline in turnover.

 

How to determine a fall in turnover

You only need to satisfy this requirement once – you don't need to retest your turnover each month. However, you will be asked each month to tell us your current and projected turnover.

 

At the time you enrol in the JobKeeper Payment scheme, you need to confirm that your business in a relevant period has had, or is likely to have, a:

  • 30% fall in turnover (for an aggregated turnover of $1 billion or less)
  • 50% fall in turnover (for an aggregated turnover of more than $1 billion), or
  • 15% fall in turnover (for ACNC-registered charities other than universities and schools).

 

How to calculate a fall in turnover for the first fortnight starting 30 March 2020

 

To work out your fall in turnover, you can compare either:

 

 

  • GST turnover for March 2020 with GST turnover for March 2019
  • projected GST turnover for April 2020 with GST turnover for April 2019
  • projected GST turnover for the quarter starting April 2020 with GST turnover for the quarter starting April 2019.

 

How you choose to project your fall in turnover is not dependent on whether you report a quarterly or monthly BAS, though you can do that if it is easier. The turnover calculation is based on GST turnover. This applies even if an entity is not registered for GST. There are some modifications, including disregarding GST grouping (where two or more associated business entities operate as a single GST group).

 

If you work out that you qualify for JobKeeper payments for the first fortnight because your turnover has declined by the relevant amount, you remain eligible and do not need to keep testing turnover in following months. However, you will have ongoing monthly reporting requirements.

 

Hope this helps

 

Amanda CW

 

2 REPLIES 2

Most helpful response

Former Community Support

Replies 1

Hi @Michelle72,

 

Thanks for reaching out to us.

 

Our website has some helpful information under Sole traders. Have a look at the information how to determine an actual decline in turnover.

 

How to determine a fall in turnover

You only need to satisfy this requirement once – you don't need to retest your turnover each month. However, you will be asked each month to tell us your current and projected turnover.

 

At the time you enrol in the JobKeeper Payment scheme, you need to confirm that your business in a relevant period has had, or is likely to have, a:

  • 30% fall in turnover (for an aggregated turnover of $1 billion or less)
  • 50% fall in turnover (for an aggregated turnover of more than $1 billion), or
  • 15% fall in turnover (for ACNC-registered charities other than universities and schools).

 

How to calculate a fall in turnover for the first fortnight starting 30 March 2020

 

To work out your fall in turnover, you can compare either:

 

 

  • GST turnover for March 2020 with GST turnover for March 2019
  • projected GST turnover for April 2020 with GST turnover for April 2019
  • projected GST turnover for the quarter starting April 2020 with GST turnover for the quarter starting April 2019.

 

How you choose to project your fall in turnover is not dependent on whether you report a quarterly or monthly BAS, though you can do that if it is easier. The turnover calculation is based on GST turnover. This applies even if an entity is not registered for GST. There are some modifications, including disregarding GST grouping (where two or more associated business entities operate as a single GST group).

 

If you work out that you qualify for JobKeeper payments for the first fortnight because your turnover has declined by the relevant amount, you remain eligible and do not need to keep testing turnover in following months. However, you will have ongoing monthly reporting requirements.

 

Hope this helps

 

Amanda CW

 

Newbie

Replies 0

Hi Amanda

 

Thank you for your advice - that is enormously helpful.

 

From this it would seem clear that sole traders are eligible and payable because we suffered at decline in turnover at the start of the covid-19 crisis and social distancing restrictions and remain payable throughout the scheme by virtue of our decline in business turnover at the commencement of the program, irrespective of fluctuating turnovers for the life of the scheme (which I suspect for many of us will be patchy). 

 

Thanks again for the advice. I have noticed that many sole traders have been asking the same question, given the confusion when you go in to make your monthly reporting declaration. I contacted the ATO last night and the very helpful Tax Officer was unable to advise me due to the confusion and newness of the scheme and suggested I hold off until this is clarified. Great work ATO for sorting out what is a very tricky scheme.