JobKeeper payment for sole traders: what you need to know

Here is everything we know about applying for JobKeeper payments as a sole trader.

Last week, we reported on the changes to the JobSeeker payment, and how the coronavirus affected sole traders who had lost income. This week, we look at the JobKeeper payment, and which sole traders can apply. From 30 March, employers and sole traders can submit an expression of interest. Sole traders will receive the flat rate of $1500 per fortnight deposited directly into their bank account on a monthly basis if their application is successful. Let’s take a look at the eligibility requirements, documents required, and how it compares to Jobseeker.

what is the Jobkeeper payment?
The JobKeeper payment is a scheme available to businesses. Unlike JobSeeker payments, which are organised through Services Australia, the JobKeeper payment is organised through the Australian Taxation Office (ATO).

This is intended to support employers in continuing to pay staff their usual rate while their businesses are not operating as usual, or they are experiencing revenue loss, at a minimum of $1500 per fortnight. It is intended solely to supplement the costs associated with paying wages, and no other overheads.

This means that a business will receive $1500 per employee as a flat rate, and is required to pass it all onto each employee. Any extra income that the employee would usually receive should be made up by the employer. So if a business has two employees, one who makes $3000 per fortnight, and one who makes $1000 per fortnight, the former will continue receiving $3000 ($1500 of which is provided through the Jobseeker payment, the other half being provided by the employer), and the latter now receiving $1500 per month. 

Sole traders are also eligible for the scheme, so long as they fit the eligibility criteria detailed below. The criteria for sole traders is the same as for any other business; they are categorised as ‘businesses with no employees.’

There is more detailed information on application and eligibility on this ATO Jobkeeper fact sheet.

Which sole traders are eligible?

The JobKeeper payment is available to sole traders who have an ABN, and have been operating under that ABN for twelve months or more. Your business must have been operating on 1 March, 2020, and you must be over 16 years of age. 

According to a fact sheet provided by the ATO, You must also be ‘an Australian citizen, the holder of a permanent visa, a Protected Special Category Visa Holder, a non-protected Special Category Visa Holder who has been residing continually in Australia for 10 years or more, or a Special Category (Subclass 444) Visa Holder.’
If you receive other payments through Services Australia, you must report your JobKeeper payment as income. 
Does the Jobkeeper application process require partner income testing?
No. Where the Government announced that the JobSeeker partner income testing threshold was raised from $48,100 per year to $79,762 per year, the JobKeeper payment is paid at a flat rate of $1500 per fortnight. It is unaffected by partner income.

How do I apply?
 While currently the service is only accepting registrations of interest, the final application will require a sole trader to:
  • Provide the Australian Business Number (ABN) for their business
  • Nominate an individual to receive the payment
  • Provide that individual’s Tax File Number (TFN)
  • Provide a declaration as to recent business activity.

This declaration is intended to demonstrate loss of business. You will have to provide information that demonstrates that your business turnover has fallen at least 30%, as compared to a similar period of at least one month, from a year earlier.

The ATO have suggested that further guidelines for sole traders are forthcoming. For now, registering your interest s the best way to stay updated. You can register your interest via the ATO

Jini Maxwell is a writer and curator who lives in Naarm. They are an assistant curator at ACMI, where they also host the Women & Non-binary gamers club. They write about videogames and the people who make them. You can find them on Twitter @astroblob