Will you need to pay back the ATO for JobKeeper
It is still surprising to consider how rapidly things have changed for employers and employees in 2020.
COVID-19 cases were first reported in Australia on 25 January 2020. By 30 March 2020 – just 2 months later – the Australian government announced an “historic wage subsidy to around 6 million workers who will receive a flat payment of $1,500 per fortnight through their employer.” The JobKeeper payment scheme was introduced and changed the employment landscape in this country overnight.
Since its introduction, the JobKeeper scheme has been the subject of refinement and amendment. It has not always been easy for employers to navigate their way through the eligibility and reporting requirements. Inevitably, some mistakes may have been made by genuine employers trying do the right thing. The ATO has said “due to the extraordinary circumstances in the early stages of the JobKeeper program, overpayments may have been made in error as businesses moved quickly to access JobKeeper payments.”
It has been identified that there has also been incidents of deliberate JobKeeper fraud
One way or another, overpayments have been made. A lot of them. In fact, the Australia Tax Office has already clawed back over $120 million dollars of JobKeeper payments which were incorrectly claimed.
What is the ATO’s attitude towards incorrect claims for JobKeeper payments which have been mistakenly made, as opposed to those which were claimed fraudulently?
The Australian Tax Office has released guidelines which clearly state that a JobKeeper payment will need to be repaid if the improper claim was made fraudulently and intentionally disregarded the law or was made recklessly. This also includes where an employer has deliberately applied for JobKeeper when not meeting the wage conditions. It will often involve a manipulation of the employer’s financial performance.
Penalties will apply if there is evidence that an employer has deliberately taken steps to receive JobKeeper payments where there is no lawful entitlement to receive them.
The good news is that the ATO has generally stated that any overpayments of JobKeeper will not need to be repaid if there has been an honest mistake, such as an employer relying in good faith on a statement made by an employee. The ATO has said “If a JobKeeper overpayment is identified, we may decide the overpayment does not have to be repaid, particularly if there was an honest mistake.”
The ATO will decide these matters on a case by case basis.
It remains important to regularly confirm your eligibility for JobKeeper payments.
If this article has raised any concerns for you or your organisation please do not hesitate to contact John Hayward on (07) 4046 1126, for advice specific to your circumstances.