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Re: Jobkeeper - business participant vs employee eligibility

Newbie

Views 492

Replies 3

Hi there,

 

I have a friend who enrolled with the Jobkeeper program in April/May as a business participant. His English isn't great and he hasn't been able to get a clear answer over the phone about this problem.

 

The issue is that he believed that Jobkeepeer payments, by law, needed to be paid out to himself as salary. So after enrolling, he set himself up as an employee and processed the payments via payroll, issuing out PAYG summaries and Group certificates for last financial year etc.

 

His accountant has since told him that when initially enrolling for Jobkeeper as a business participant, one of the criteria was that the person applying wasn't an employee of his own business. At the time of first applying, my friend wasn't an employee of his own business, so that box was checked.

 

He's now incredibly anxious that, by officially becoming an employee of his own business in the interim, he may have caused a glitch in the Matrix and may have to pay Jobkeeper payments back.

 

There is no issue/concern re: "double dipping" as both a business participant and as an employee here - he is only receiving one payment, he is the owner,  however he's been receiving that Jobkeeper payment as a business participant when he has gone on to pay a number of those payments to himself as an employee of his own business.

 

He understands that he has to pay tax on that as personal income, however is there legislation that says a business participant is restricted from becoming an employee of their own business in the future, or that becoming an employee would make him ineligible, meaning he would need to re-pay the Jobkeeper payments back?

 

I notice under the sole traders/ partners/ directors FAQ, "what if I have another job", it says a business participant is allowed to be casual employee with another entity, so surely he is allowed to be a casual employee of his own business? For the record, he doesn't work anywhere else/ have any other job.

 

On top of the business restrictions, this has been causing him some distress, so any reassurance that he's not potentially owing thousands of dollars in needing to return these payments because of a silly error would be greatly appreciated.

 

Thank you for your time!

1 ACCEPTED SOLUTION

Accepted Solutions

Most helpful response

Former Community Support

Replies 2

Hi @ RonaldR

 

Thanks for your question. The information that we have on our website states that an eligible business participant is an individual who's not an employee of your company but is actively engaged in it's operation. I suggest you have a look at the rest of the information.

 

Thank you for contacting us and have a nice day!

3 REPLIES 3

Most helpful response

Former Community Support

Replies 2

Hi @ RonaldR

 

Thanks for your question. The information that we have on our website states that an eligible business participant is an individual who's not an employee of your company but is actively engaged in it's operation. I suggest you have a look at the rest of the information.

 

Thank you for contacting us and have a nice day!

Newbie

Replies 1

Thanks very much for the response, Lisa.

 

"

  • An individual can only count as either an eligible employee or an eligible business participant, not both."

 

Looking at that link and the above quote, he's happy to have been "counted" as a business participant the whole way through.

 

It's just that for a short period of time, he was also technically an employee.

 

He was exclusively a business participant when applying and has since stopped being an employee (and is only a business participant again) since realising this issue.

 

He's called the ATO again, the representative said he should be fine and won't have to alter anything with his Jobkeeper application or pay anything back - hopefully he doesn't encounter any issues down the track.

 

Thanks again for your help.

ATO Community Support

Replies 0

Hiya @RonaldR,

 

The eligibity criteria for a business participant applies as of the first of March. So if your friend later is employed by the business, he is still fine, because on the date to determine eligibility, he wasn't. So he won't have any problems.