Accountants assisting clients with the JobKeeper extension have been urged to pay close attention to the actual decline in turnover test, with the ATO unable to offer leeway for those who come just shy of the requirements.
With JobKeeper now requiring entities to satisfy the new actual decline in turnover test, rather than the projected decline in turnover test used earlier in the program, the ATO will be required to follow the strict letter of the law in ensuring the requisite percentage declines are satisfied.
“[In JobKeeper 1], the legislation didn’t require the actual turnover to decline, so we saw a lot of organisations make a projection in a very difficult environment… and a lot of those projections didn’t pan out and that’s fine,” said ATO assistant commissioner Sandra Farhat on a recent ChangeGPS webinar.
“But moving into the extension, that is the test; the test is an actual decline.
“There is really no discretion in relation to decline in turnover, so there is no ability for the ATO to say, ‘Well, you were close, just not close enough, but we’ll let you through’ — the 30 per cent is a hard and fast legislative requirement.
“It is a significant change from a projected decline in turnover to an actual decline in turnover.”
The approach is a shift from the “sympathetic and understanding” stance that the ATO committed to earlier in the year when queried on how it would police the projected decline in turnover estimates.
ATO second commissioner Jeremy Hirschhorn told a Senate inquiry in May that the ATO would not nitpick turnover estimates that fell just short of the requirements because the law had merely required entities to make a reasonable estimate.
“If it ultimately turns out that the estimate was overly pessimistic and a business only went down 29 per cent, instead of an estimated 35 per cent, that is OK; what the legislation requires is a reasonable estimate,” Mr Hirschhorn said earlier this year.
Clawing back JobKeeper payments
The ATO’s confirmation of its new position comes as it releases fresh guidance on how it will manage JobKeeper payments that were incorrectly paid out.
For payments that were made because of an honest mistake, the ATO will not seek to recover these payments.
The facts and circumstances of each case will be considered, including whether the mistake was made earlier in JobKeeper when there was less public guidance.
Entities that did not take reasonable steps to check their eligibility will not be considered as having made an honest mistake.
Where payments will need to be repaid, the Tax Office will write to the entity to inform it of the reasons for clawing back the payments, how much needs to be repaid, and how repayments can be made.
Objections will be considered, while payment plans will be made available to those who aren’t able to pay on time.
The ATO also notes that it will generally not impose administrative penalties for JobKeeper overpayments that were the result of a mistake.
However, administrative penalties will apply if there is evidence of deliberate actions to obtain JobKeeper payments that an entity would not have otherwise been entitled to.
Jotham Lian
23 October 2020
accountantsdaily.com.au
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Chris is the Managing Director of the Firm who established the practice in August 1994 and has been responsible for its growth and development since that time.
Chris has over 40-years experience in the Chartered Accountancy profession, predominantly spent in small to medium sized firms, advising both small business and individuals in areas such as taxation and accounting as well as business restructuring and superannuation advice.
Chris is active in the development of young accountants both in mentoring cadets at the Firm and lecturing in taxation for the CA Program for the Institute of Chartered Accountants & New Zealand.
Dianne is responsible for the day-to-day operations and administration of the practice.
Dianne has over 30-years Chartered Accountancy experience and has significant expertise in providing advice and solutions to high-net-worth individuals and their associated entities. Dianne also has considerable knowledge in the areas of taxation, business services, superannuation, and compliance.
Dianne is active in promoting gender equality in the industry through various programs and mentoring opportunities. Dianne is also committed to the development of young accountants and donates considerable time to sharing her expertise.
Roger is responsible for the HR aspect of the Firm, cultivating the culture, and maintaining the highly social environment we pride ourselves on.
Roger has over 35-years in the Chartered Accountancy profession and significant expertise in providing advice and solutions to small businesses and high-net-worth individuals. He also has extensive experience in the areas of Self-Managed Superannuation Funds and retirement strategies.
Roger is active in the development of young accountants both in mentoring cadets at the firm and lecturing in taxation for the CA Program for the Institute of Chartered Accountants & New Zealand.
Tess has over 22-years experience in Chartered Firms and in this time has had a broad range of experience in superannuation, taxation, and business services. In particular, Tess has had significant experience in MYOB and assisting clients in day-to-day bookkeeping activities and periodic reporting.
Tess is responsible for the Firm’s training and development needs.
Tess is active in promoting gender equality in the industry through various programs and mentoring opportunities. Tess is also committed to the development of young accountants and donates considerable time to sharing her expertise.
Adam has over 18-years experience in Chartered Firms and in this time has had a broad range of experience in superannuation, taxation, and business services. In particular, Adam has had significant experience in MYOB and assisting clients with periodic management reporting.
Adam is responsible for the implementation of technology in the Firm and sourcing new areas of innovation and efficiency.
Adam is active in the development of young accountants and donates considerable time to sharing his expertise.
Build your career with expert guidance from our accounting cadetships program, based in Sydney NSW.
Each year we offer several school leavers or undergraduates the opportunity of beginning their career with us via an Accounting Cadetship. If you are interested in pursuing a career in accounting please read the information below. Our accounting cadetships could be perfect for you!
An Accounting Cadetship enables you to commence your career whilst attaining the necessary university qualifications by studying part-time.
Generally, our cadets complete a Bachelor of Commerce (BCom) or Bachelor of Business (BBus) degree at the University of New South Wales, the University of Technology Sydney, Macquarie University, or the University of Western Sydney.
The firm provides 3 hours paid study leave per week to attend University. This can either be taken at the one time or broken between days depending on the individual’s requirements. In addition, the Firm provides paid study leave for both mid-semester and end-of-year exams.
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Our cadets benefit from the following:
The completion of your degree is the first step of what we hope to be a long and successful career with us. The next step is the commencement of your CA Program with the Institute of Chartered Accountants Australia and New Zealand whilst at the same time continuing your employment with us.
A number of cadets have progressed to Seniors, Managers, and Directors within the firm.
Current Year 12 students or first/second year University Students who:
To apply for a Cadetship position at Wybenga & Partners send us your details. Please also include in your covering letter why you wish to do a cadetship, include relevant qualities you possess, main interests / achievements, and any previous employment.
Interested candidates should initially forward a resume/covering letter of no more than 3-pages. Please provide full details of contact information (telephone or e-mail).
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