22nd October 2020   |   Business

Accounting

Treasurer Josh Frydenberg has announced a new $4 billion JobMaker hiring credit to help accelerate growth in employment during the COVID recovery by giving businesses incentives to take on additional employees that are young jobseekers aged 16 to 35 years old. 

The $4 billion will be provided over three years from 2020–21 and will be available to eligible employers over 12 months from 7 October 2020 for each additional new job they create for an eligible employee.

Eligible employers who can demonstrate that the new employee will increase overall employee headcount and payroll will receive $200 per week if they hire an eligible employee aged 16 to 29 years old or $100 per week if they hire an eligible employee aged 30 to 35 years old.

“All businesses, other than the major banks, will be eligible,” said Mr Frydenberg on Tuesday evening.

“Treasury estimates that this will support around 450,000 jobs for young people. Having a job means more than earning an income. It means economic security. It means independence. It means opportunity.”

Capped at 12 months, the JobMaker hiring credit will also have a maximum amount of $10,400 per additional new position created.

According to the budget rules, to be eligible, the employee will need to have worked for a minimum of 20 hours per week, averaged over a quarter, and received the JobSeeker Payment, Youth Allowance (other) or Parenting Payment for at least one month out of the three months prior to when they are hired.

The government has also outlined a $1.2 billion investment to help Australian businesses employ 100,000 new apprentices or trainees as part of its COVID-19 economic recovery plan.

As of Monday, 5 October, businesses who take on a new Australian apprentice will be eligible for a 50 per cent wage subsidy, regardless of geographic location, occupation, industry or business size, the government has announced. 

The subsidy will be available to employers Australia-wide who engage an Australian apprentice or trainee from 5 October 2020 until the 100,000 cap is reached.

To be eligible, employers must:

  • hold an Australian Business Number (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).

Eligible employees must have worked an average of at least 20 hours per week over the quarter for the employer to qualify for the payment. Employees that start and/or stop employment during a quarter must meet a similar test based on the length of time in employment.

For the employer to be eligible, new employees must:

  • be aged 16 to 35 years
  • be in receipt of income support payments (such as JobSeeker Payment, Youth Allowance (Other), or Parenting Payment) for at least one of the three months before they were hired.

Further eligibility conditions will apply to employers based on the employer’s headcount and payroll on 30 September 2020. These conditions ensure that employers claim credits for additional jobs created rather than for replacing existing employees.

For more information contact info@Ax3.com.au

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