Are you looking to hire new staff, but are concerned about rising wage costs? Well, the federal government has heard you and is offering the JobMaker Hiring Credit Scheme to subsidise the cost of taking on new recruits. Let’s take a look at what the scheme is offering, and how it can benefit you.
What is the JobMaker Hiring Credit Scheme?
The scheme is designed to incentivise businesses to hire young employees between the ages of 16 and 35. It does this by providing payments in arrears to employers on a quarterly basis. The payments available are:
- $200 per week for an employee between 16 and 29 years (inclusive);
- $100 per week for an employee between 30 and 35 years (inclusive).
The initiative started 7 October 2020 and will end 6 October 2022. Nominated employees can be subsidised for up to a year, assuming they remain eligible. The subsidy is capped at $10,400 for each additional employee.
Who’s eligible for the JobMaker Hiring Credit Scheme?
Both employers and employees are subject to certain requirements to qualify for the scheme.
Eligible employers for JobMaker
There are several eligibility criteria that must all be met. For any Australian business or not-for-profit, you will be an eligible employer if you:
- Have an active Australian business number;
- Are registered for pay as you go withholding;
- Haven’t received JobKeeper payments for a fortnight starting within the JobMaker period being claimed;
- Are current on all income tax and GST returns for two years up to the end of the JobMaker period being claimed;
- Meet payroll and headcount conditions;
- Meet reporting requirements including Single Touch Payroll (STP) reporting.
There are certain disqualifying factors that will render you ineligible. If any of those criteria are relevant to you, you cannot claim credits for the period in which those factors apply.
Eligible employees for JobMaker
Any individual employee can only be nominated for the scheme by one employer. After starting employment, they must complete a JobMaker Hiring Credit employee notice to confirm their eligibility. They must meet all of the following criteria:
- Are between 16 and 35 years old at the start of their employment;
- Began work between 7 October 2020 and 7 October 2021;
- Have worked a minimum of 20 hours per week on average for the JobMaker period;
- Received one of the following government payments for two consecutive fortnights within 84 days prior to employment;
- JobSeeker Payment
- Parenting Payment
- Youth allowance (unless it was received for pursuing full time study or an apprenticeship).
A person cannot be nominated for the scheme if they are a sole trader. Also, the employer’s spouse, or a relative of the employer or their spouse, are also disqualified.
Registering for the JobMaker scheme
If your business has an active ABN, you can register to receive JobMaker Hiring credits through ATO online services, online services for business, or your registered tax or BAS agent may apply on your behalf.
Once registered, you can nominate employees and update their details through your STP-enabled software. Once you have reported your employee information, you can make a claim through the ATO online portals. This process will show you the eligibility status of your nominated employees and the claim you’re entitled to.
It’s vital to keep up-to-date information on your employees like their age and what government payments they have received to ensure their continued eligibility.
Receiving JobMaker Hiring credits will affect your access to other initiatives such as JobKeeper payments or the Australian Apprentice Wage subsidy. It’s worth getting expert advice on available subsidies to determine what will provide the most benefit to your business before applying.
Doing business in the current economic climate requires real-time adaptation to policy and market forces. At CPL, our team of commercial law experts are specialists will provide you with counsel that will enable you to navigate policy changes with confident and proactive decision-making. If you are facing challenges with government wage subsidies claims, employee relations, and contracts or other commercial business matters, we’re here to help. To learn more about our unique service model, have a look here.
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