It’s been almost 30 years since Australia last experienced a recession and almost 10 years since the country recorded a negative GDP growth, which was back in 2011 when the Queensland flooding and Cyclone Yasi hit. With the latest downturns in Australia’s quarterly GDP reports, as well as the economic effects of the pandemic, the future Read More…
Risky business: Ignoring JobKeeper scheme could leave some with regrets
Tue 14 April 2020 - 5:48 pmFeatured | Finance
Business owners are being urged to register for the JobKeeper allowance despite trepidation and confusion from many around the scheme, according to a leading tax expert.
Pilot Partners head of taxation Murray Howlett said business owners who took a ‘wait and see’ approach to the scheme could be missing out on a huge financial incentive.
Today the Government hopes to pass legislation that will make the fortnightly $1,500 payment available to businesses with a turnover of less than $1 billion which can demonstrate a fall in turnover of 30%.
“I’m talking with a lot of business owners who simply don’t know whether or not they should register,” said Mr Howlett.
“The government is encouraging business to retain staff for when things get back to normal but there is a disconnect between registering for the JobKeeper allowance now and paying staff, including casual employees, and waiting for the ATO to reimburse business the funds.
“They’re concerned that if they do register and their turnover does not fall below the 30% threshold, they have an issue and if they don’t register because they don’t expect to have a shortfall, then they’ve entirely missed the boat.
“It’s an all or nothing choice and either way it could be the wrong call.
“Our advice is that you should consider registering regardless, with the knowledge that there may be a chance you’ll have to pay the money back.”
Mr Howlett said many business owners were feeling the pressure to register for the government’s wage subsidy by casual staff who could potentially earn more than their usual income.
But, Mr. Howlett said, “You have to commit to the behaviour today and start paying the allowance to staff without really knowing what your turnover will be in the coming three months and understandably that’s a daunting proposition.
“Business owners need to be aware that they aren’t entitled to the wage entitlements until the moment they register, and the payments are not backdated.
“Ultimately, the risk of doing nothing at all may be far greater than the risk of registering.”