JobKeeper Extension Focus Areas Identified by ATO
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JobKeeper Extension Focus Areas Identified by ATO

ATO warns on JobKeeper ‘rorts’

JobKeeper extension focus areas identified by ATO.  In the announcement the ATO stated it will keep a particularly close watch on businesses that have apparent irregularities in their GST turnover as well employers claiming the higher subsidy rate.

While its JobKeeper assurance reviews have identified that the vast majority of businesses have done the right thing to date, the ATO confirmed it has caught several employers red-handed.

Aside from requiring these employers to repay JobKeeper overpayments, the ATO has also applied administrative penalties and pursued offences for false and misleading statements.

Examples of malicious behaviour include:

  • large businesses that applied the 30 per cent decline in turnover threshold when they were required to apply the 50 per cent decline in turnover threshold.
  • businesses that manipulated their sales in order to change their projected GST turnover to meet the decline in turnover test.
  • backdated employment relationships to misrepresent employee eligibility in order to claim more JobKeeper payments,
  • businesses that failed to meet the wage condition in relation to their employees by not paying them the full JobKeeper amount,
  • individuals who controlled multiple businesses and deliberately claimed JobKeeper for themselves as the eligible business participant multiple times,

But as the extended JobKeeper payment hits employers’ pockets, the ATO underlined its continued focus on the scheme’s integrity.

ATO Checking Business Turnover Test & GST Manipulation

As such, the Tax Office will be looking for businesses that do not meet the decline in turnover test; that have disregarded the wage condition; and that have claimed JobKeeper for ineligible individuals, including for more than one business participant.

“We will also be monitoring the new requirements introduced under the JobKeeper extension,” the ATO said.

“In particular, we will be reviewing businesses that appear to have contrived eligibility for the JobKeeper extension by manipulating their GST turnover to meet the actual decline in turnover test; have claimed the incorrect, higher-tier rate for their employees, eligible business participants or religious practitioners when they should have been on the lower tier.”

Cases Being Referred To Australian Federal Police

Last month, Commissioner of Taxation Chris Jordan said that the Australian Federal Police (AFP) is leading 11 ongoing criminal investigations into potential fraudulent behaviour across the stimulus measures.

These behaviours include claiming for individuals who are not employees, manipulation of turnover, and false claims where there is no business activity at all.

“As these matters are ongoing, I cannot provide any further information at this stage,” Mr Jordan said at the time.

He added that the ATO’s compliance program has stopped over 55,000 ineligible applications at the very first stage of the JobKeeper program and delayed $1 billion in payments to more than 75,000 applicants in order to run further checks.

These checks have resulted in an additional 48,000 compliance activities.

Ensuring compliance with JobKeeper rules, plus ensuring GST is stated correctly, can be complicated and confusing at times.  That said the ATO’s stated vigilance in these areas, to ensure everyone plays by the rules, makes essential for you and your business to be in compliance.

Need Help?

If you have questions related to the above, or need help, the MB+M’s Business Services team is here to help. The team has extensive experience in advising clients on JobKeeper & GST matters.

An experienced Business Services Advisor can assist you to get it right, and avoid non-compliance with the rules and regulations. So if you need some guidance call MB+M on 03 5821 9177 and speak with an experienced Business Services Advisor.

Article Originally published in My Business on 27th October 2020

Additional Reading:  

1. Keeping JobKeeper fair – extension focus areas

2. JobKeeper Update – 14 Aug 2020

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