Reporting JobKeeper payments
JobKeeper payments are taxable and need to be included in tax returns.
If you’re a sole trader who has received JobKeeper payments, you need to include the payments as business income at the label ‘Assessable government industry payments’ in your individual tax return.
If your business is a partnership, trust or company, and your business received JobKeeper payments, you don’t need to include it as assessable income in your individual tax return, but you still need to report JobKeeper payments as either:
- business income at the label ‘Assessable government industry payments’ in your partnership or trust tax return
- income at the label ‘Assessable government industry payments’ in your company tax return.
Your accounting method will also affect the total JobKeeper payments that need to be included in your tax return. If your business operates on:
- an accruals accounting basis
- JobKeeper payments relating to valid business monthly declarations made on or before 30 June 2020 are included in your 2019–20 tax return
- JobKeeper payments relating to valid business monthly declarations made on or after 1 July 2020 are included in your 2020–21 tax return
- a cash accounting basis
- JobKeeper payments you received on or before 30 June 2020 are included in your 2019–20 tax return
- JobKeeper payments received on or after 1 July 2020 are included in your 2020–21 tax return.
If you have received a JobKeeper overpayment, you will need to repay the amount.
Depending on the circumstances, we may decide it does not have to be repaid (particularly if there was an honest mistake) and will let you know.
If you:
- have repaid, or are repaying JobKeeper overpayments, you do not need to include the amount as assessable income in your tax return. If you have already included the overpaid amount in your business income tax return in an earlier year, you will need to amend that earlier return to reduce your assessable income by the amount you have repaid
- don’t need to repay JobKeeper overpayments because we have waived it, you will still need to include the overpaid amounts as assessable income in your business tax return.
Your employees won’t need to do anything different as the payments will be included as salary and wages, or an allowance, in the regular income statement or payment summary you provide as an employer.
Reporting cash flow boost credits
You don’t pay tax on cash flow boost credits, as they are non-assessable non-exempt income. How you report the amounts in your returns or financial statements is different depending on your business structure.
Cash flow boost credits do not need to be included in your tax return. However, if you have included the amounts in your gross income for accounting purposes, you can include it at:
- item P8 business income and expenses as other business income and as an income subtraction reconciliation amount in the individual tax return for sole traders
- item 5 as other business income and as an income subtraction reconciliation amount for partnership and trust tax returns
- item 6R other gross income and item 7Q other income not included in assessable income for company tax returns.
Other government payments
If you’ve received an Australian, state or territory government grant or payment in response to recent natural disasters or COVID-19, you may need to include it in your assessable income.
Single Touch Payroll
With Single Touch Payroll (STP), you report employees’ payroll information to us each time you pay them through STP-enabled software.
STP started on 1 July 2018 for employers with 20 or more employees and 1 July 2019 for employers with 19 or fewer employees. If you haven’t started reporting through STP, you need to start as soon as possible.
Every year, employers must make an end-of-year finalisation declaration through STP. Generally, you need to make this declaration by 14 July each year. If you can’t make a finalisation declaration by the due date, you need to apply for a deferral.
You can finalise your data earlier if it’s ready. The sooner you finalise your employees’ information, the sooner they will be able to lodge their tax returns.
Reporting through STP means you no longer need to give your employees payment summaries or lodge an STP payment summary annual report with us.
Your employees can find the information they need in their income statement in ATO online services through myGov, or by contacting their tax agent.
For more information please feel free to contact with us.
Address: Suite 19/328 Albany Hwy, Victoria Park, WA 6100, Australia
E-mail: enquiries@swanpartners.com.au
Phone: (08) 6162 9808