In the Budget, the Government announced high level details of the JobMaker hiring credit scheme. To date, the Bill enabling JobMaker has been introduced into Parliament but has not passed. In addition, Treasury has released an exposure draft of the rules for consultation.
Economic Recovery Package (JobMaker Hiring Credit) Amendment Bill 2020
The Bill enabling JobKeeper has been introduced into Parliament and referred to the Senate Economics Legislation Committee (due to report on 6 November 2020). Much like the JobKeeper rules, this Bill simply gives the Treasurer power to issue a legislative instrument setting out the rules for the JobMaker scheme.
Exposure draft – JobMaker Hiring Credit Rules
In addition to outlining the requirements and workings of the JobMaker, the exposure draft outlines the integrity provisions – where the employee headcount or payroll has bene artificially inflated to access the hiring credit. Consultation closes on 27 November 2020
JobMaker hiring credit outline
The comments below reflect guidance provided by the Government and Treasury but remember that the final details could well be different.
Eligible employers will have access to a JobMaker hiring credit for each new job they create over the 12 months from 7 October 2020, for which they hire an eligible employee, for a maximum claim period of 12 months from their employment start date.
For a business to be eligible it needs to meet the following criteria:
- Hold an ABN;
- Be up-to-date with their tax lodgement obligations;
- Be registered for Pay As You Go (PAYG) withholding;
- Be reporting through Single touch payroll (STP); and
- Keep adequate records of the paid hours worked by the employee they are claiming the hiring credit in respect of.
The business must also be able to show that the employee is working in an additional job created
from 7 October 2020. To demonstrate that the job is additional, specific criteria must be met.
The ‘additionality’ criteria require that there is an increase in:
- The total employee headcount (minimum of one additional employee) of the business compared initially to 30 September 2020 and then to the previous reporting period; and
- The total payroll of the business for the reporting period, as compared initially to the September 2020 quarter and then to the previous reporting period.
Newly established businesses and businesses with no employees at the reference date of 30 September 2020 are also able to claim the credit where they meet the criteria, however they will not be eligible for the first employee hired (i.e. as the minimum headcount is one), but will be eligible for the second and subsequent eligible hires.
Eligible employees must have received JobSeeker Payment, Youth Allowance (Other), or Parenting Payment for at least one of the previous three months at the time of hiring and work at least 20 paid hours per week on average for the full weeks they are employed over the reporting period. They are also required to be in their first year of employment with that employer, reflecting that the hiring credit is only available for 12 months for each additional job. The credits are available for employees employed on a permanent, casual or fixed term basis.
To receive the JobMaker credits, employers will need to register with the ATO and make claims quarterly, with claims commencing in February 2021.
The amount of the JobMaker hiring credit will be:
- $200 per week for each eligible employee aged 16 to 29
- $100 per week for each eligible employee aged 30 to 35.
Note that employers cannot claim JobKeeper and JobMaker hiring credit for an employee at the same time.
The JobMaker credit cannot be claimed where other Federal Government payments are being received for the employee, i.e., JobKeeper or apprenticeship subsidy.
