JobMaker – Explanation and requirements

JobMaker Overview

  • The JobMaker Hiring Credits scheme provides a cash payment to businesses that increase their headcount by hiring workers aged 16-35 years. 
  • These new employees must have been receiving a government payment such as JobSeeker, Youth Allowance or the Parenting Payment for at least two of the six fortnights prior to being employed into the role with you.
  • Employees must work a minimum average of 20 hours per week during the JobMaker period in order for the business to receive the hiring credit.
  • The credits can be claimed for employees hired between October 7, 2020, and October 6, 2021, with businesses able to claim up to a total of $10,400 over the 12 month period for each eligible employee aged between 16 and 29, and $5,200 for those aged 30 to 35. 
  • The credits will be paid quarterly in arrears. The first payment period will open for claims on February 1, 2021 for those new employees added since 7 October 2020.   Hiring Credits can be claimed for the new employees for the first 12 months of employment or until 6 October 2022.
  • You can not replace one employee’s hours with a new employee and you can not claim an increase in payroll for others that doesn’t relate to the
    increase in employment.

The first step is to register via the ATO website

Once registered, eligible employers can claim the JobMaker Hiring Credit payment for each JobMaker period. You can make a claim for the first JobMaker period from 1st February 2021. Payments are made in arrears

Employers will need to register before making a claim for JobMaker Hiring Credit payments. Registration for Period 1 (7th Oct to 6th Jan 2021) is due 30th April 2021.

You do not need to be registered before you hire eligible employees.

If BPI processes your payroll via Xero & STP, and you think you may be eligible having increased your headcount, please let us know and we will complete your registration and also the calculation of claims through the ATO portals.

An eligible employer must have an increase in the baseline headcounts and amount of payroll expense.  The amount of credit in each period is limited to the increase in payroll expense.

Government requires businesses to be utilising Single Touch Payroll Reporting and to provide additional codes through your software to the ATO in order to facilitate the claiming of the credit.

If BPI are not already processing your payroll, and you would like us to assist you with the JobMaker process, please give us a call.

JobMaker Background

Whilst handing down the new Federal Budget the Federal Government introduced its latest wage subsidy scheme – the JobMaker Hiring Credit.

This new scheme is aimed at supporting employers to create new jobs within their business and employ additional people, specifically those aged between 16 and 35 years old. Employers will get paid for each new job they create over the next 12 months from 7 October 2020 until 6 October 2021.

Employers will receive:

  • AUD$200 per week for eligible employees aged from 16 to 29 years old
  • AUD$100 per week for eligible employees from 30 up to 35 years of age

Can Any Employer Get JobMaker?

From 30 September 2020, you must show you have increased the overall number of employees within your business by at least one person, and your payroll has increased accordingly. From then you can receive the JobMaker Hiring Credit for each position created for a period up to 12 months from the date that new person starts working for you.

You must also:

  • Hold an Australian Business number (ABN)
  • Be up-to-date with your tax lodgement obligations
  • Be registered for Pay As You Go (PAYG) withholding
  • Be reporting through Single touch payroll (STP).

How Can I Register for the Scheme?

Similar to JobKeeper, to receive JobMaker employers need to report their employees’ payroll information to the Australian Tax Office (ATO) through Single Touch Payroll.

Unlike JobKeeper, there is no need to demonstrate a decline in turnover, rather just demonstrate an increase in people employed by the business over the quarter. Businesses don’t need to be registered for the scheme at the time a new job is created, only when they claim.

You can claim the subsidy every quarter. The first quarter will run from 7 October 2020 to 6 January 2021. You can register for the scheme from 7 December 2020 on the ATO website. Claims for the first quarter can be made from 01 February 2021.

Can I claim it for any new hire?

No. The person you are putting on must be aged between 16 and 35 years of age to qualify and they need to have received some kind of income support for at least one month in the three months before you hired them.

Specifically, they must have received one of the following over the last three months:

  • a JobSeeker Payment
  • a Youth Allowance (Other)
  • a Parenting Payment

In addition, employees must have worked an average of at least 20 hours per week over the quarter for the employer to be able to get the payment.

Newly established businesses and businesses with no employees at the reference date of 30 September 2020 are able to claim the JobMaker Hiring Credit where they meet the criteria from their first eligible employee.

For more information, visit the ATO website – JobMaker Hiring Credit Scheme

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