JobKeeper decline in turnover tests: temporary trading cessation

An additional category for alternative “decline in turnover” tests is now available for the purposes of the revised JobKeeper payment system (which commenced on 28 September 2020) for entities that temporarily ceased trading for some or all of the relevant comparative period.
Under the revised system, an entity must have had an actual decline in its turnover for the applicable quarter relative to the same quarter in 2019. This generally involves making a one-to-one comparison of the 2020 numbers to those in the corresponding period in 2019, to see if it exceeds the 15%, 30% or 50% decline threshold (depending the type of entity).
Alternative tests can only be used if there is not an “appropriate relevant comparison period” in 2019, and four requirements must be satisfied for an entity to use the alternative tests for the new “temporary cessation of business” category. That is, in the comparison period:
• the entity’s business had temporarily ceased trading due to an event or circumstance outside the ordinary course of the entity’s business;
• trading temporarily ceased for a week or more;
• some or all of the relevant comparison period occurred during the time in which the entity’s business had temporarily ceased trading; and
• the entity’s business resumed trading before 28 September 2020.
TIP: If your business doesn’t meet the requirements for the temporary cessation category, you may still be eligible to apply alternative tests under other categories. Contact us to find out more.

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