JobMaker Hiring Credit Scheme

The JobMaker Hiring Credit scheme provides an incentive for businesses that employ additional young job seekers aged from 16 years to 35 years.

Employers that are eligible, can access the JobMaker Hiring Credit for every new additional employee that they will hire or hired between 7 October 2020 to 6 October 2021.

JobMaker Eligibility

There are three eligibility tests for JobMaker:

Employer eligibility

At the time of enrolment, the business must:

• Have an ABN.

• Carry on a business in Australia, or is a non-profit that pursues its objectives mainly in Australia, or a DGR that meets certain conditions.

• Be registered for PAYG withholding.

At the time a JobMaker claim is submitted for a period, the business must:

• Be an eligible employer.

• Be up to date with certain tax lodgements (tax returns, GST returns) .

• Have at least one additional employee (See 'Additionality' test).

• Have increased headcount (See 'Additionality' test).

• Have increased payroll (See 'Additionality' test).

• Not be receiving other forms of assistance from the Commonwealth Government for the employee, for example JobKeeper or an apprenticeship subsidy (See Who is not eligible for JobMaker?).

And:

• Elect to participate in the JobMaker scheme (See How to register for JobMaker)

• Report through single touch payroll (there are some limited exceptions)

• Submit a claim to the ATO for the JobMaker period. Keep adequate records (hours worked by the employee the employer is claiming for)

• Another employer is not claiming JobMaker for the same employee

Employee eligibility

The employee must:

• Have received the JobSeeker Payment, Youth Allowance (Other) or Parenting Payment for at least 28 consecutive days (or 2 fortnights) in the 84 days (or 6 fortnights) prior to starting employment.

• Be at least 16 years old and less than 36 years of age at the time their employment started.

• Started work between 7 October 2020 and 6 October 2021 (inclusive).

• Worked or been paid for at least 20 hours per week on average for the full weeks employed for the period being claimed (See Calculating headcount and payroll).

• Not be an excluded employee (See Who is not eligible for JobMaker?).

‘Additionality’ test

To access the JobMaker payment, an employer must demonstrate:

• Total employee headcount on the last day of the reporting period increased by at least one additional employee compared to baseline headcount (See Calculating headcount and payroll).

• Total payroll for the reporting period increased compared to baseline payroll (See Calculating headcount and payroll).

Who is not eligible for JobMaker?

Government entities or agencies, banks and other institutions subject to the bank levy, businesses in liquidation, and foreign Government entities (unless a resident entity), are unable to access JobMaker.

If the employer is claiming JobMaker, it cannot also receive any of the following payments for the employee:

• Supporting Apprentices and Trainees Wage subsidy;

• Australian Apprentice Wage subsidy;

• Boosting the Apprenticeship Commencements Wage subsidy; or

• Restart, Youth Bonus, Youth, Parents or Long-term Unemployed Wage subsidies.

Certain employees are also excluded. These include:

• Employees who commenced employment 12 months or more before the first day of the JobMaker period (even if the employer has claimed JobMaker for less than 12 months, for example where the employee was eligible for JobKeeper). The entitlement to JobMaker is for 12 months from the date the eligible employee commenced employment.

• Contractors, subcontractors or labour hire employees.

• Employees who were engaged by the business at any time in the 6 months before 6 October 2020, other than as an employee, to perform a substantially similar role or substantially similar functions or duties to those performed as an employee. For example, JobMaker cannot be claimed for a contractor who becomes an employee.

JobMaker also cannot be claimed for:

• Sole traders (as they cannot employ themselves);

• Partners of a partnership;

• Trustees and beneficiaries of trusts (that are not widely held unit trusts); or

• Directors or shareholders of companies (that are not widely held).

JobMaker also cannot be claimed for close associates of the business and its owners. A “close associate” is a relative of an individual, partner, trustee, beneficiary, director or shareholder. The rules also apply on a look-through basis.

For example, this would mean that a child of a director of a trustee company of a trust is excluded. A relative is:

• The spouse of the person;

• A parent, grandparent, brother, sister, uncle, aunt, nephew, niece, lineal descendent or adopted child of that person, or of that person's spouse;

• The spouse of the parent, grandparent, brother, sister, uncle, aunt, nephew, niece, lineal descendent or adopted child of that person, or of that person's spouse.

To know more about JobMaker read our article: What is JobMaker?