Jobkeeper payments start flowing through

Businesses have until May 31 to apply for help, writes

Sophie Elsworth

JOBKEEPER payments will start to flow into the pockets of employers this week and, for those who haven’t yet signed up to the scheme, there is still time.

The first payments from the Federal Government’s $130 billion scheme – designed to cushion the blow for cashstrapped businesses and their staff – can’t arrive soon enough.

Over the past month many businesses have had to shell out Jobkeeper payments themselves while waiting to be reimbursed.

Crown Money Management chief executive officer Scott Parry said eligible employers yet to sign up should do so sooner rather than later because it did take time. He said employers should also look at ways to save money.

“The key for all the businesses who are suffering all these huge turnover drops: They have to cut costs and review all their expenses,” Mr Parry said.

“This is everything from the broadband to gas and electricity costs and look to freeze these, and also review any loans they have.”

More than 600,000 businesses have enrolled in the scheme, which covers around 3.6 million employees.

Many smaller operators, including sole traders with a turnover of up to $50 million, also have the option of government-guaranteed loans of $250,000 per borrower, with repayments holidays of six months attached.

Banks have set up designated hotlines to assist businesses that need finance until the first Jobkeeper payments arrive.

“There has been a huge delay in the banks getting back to people on these loans,” Mr Parry said.

“But be very careful with these because if, in six months’ time, your turnover hasn’t resumed, then you will have debt repayments and that could be a very slippery slope.”

As for eligible employees who are entitled to the $1500 fortnightly payments via their employer, if this has meant a pay cut for them they, too, should review their weekly expenses to see where they can reduce costs.

The Jobkeeper payment is the equivalent of about 70 per cent of the median wage.

H & R Block director of tax communications Mark Chapman said businesses should get a clear understanding of what stimulus packages they were entitled to.

“There’s a whole lot of eligibility criteria and it can be quite difficult to work out what you are eligible for,” he said.

“It’s worthwhile sitting down with your accountant to work out if you are eligible for the schemes, what you get and how you apply.”

Mr Chapman said businesses had to work out their turnover to see if there had been enough of a fall to be eligible for Jobkeeper, and should enrol before the May 31 deadline.