COVID-19 wage subsidy (JobKeeper) payments

Let's start by creating the income account to keep track of the JobKeeper payments you receive.

1. Go to the Accounting menu and choose Chart of accounts. The Accounts page appears.
2. Click Create account. The Create account page appears.
3. Select Detail account.
4. Choose Income as the Account type.
5. Choose Income as the Parent Header.
6. Enter a 4-digit Account number after the dash which suits your accounts list. For example, 4-1001.
7. For the Account Name enter JOBKEEPER SUBSIDY (NO GST), to help you and your employees identify the JobKeeper payments.
8. (Optional) Enter the account's Opening balance.
9. Choose N-T Not Reportable as the Tax Code.

10. (Optional) Enter Notes about this account.
    Here's our example:
    

11. Once you're done, click Save.

You can now set up the required wage (allowance) pay items to ensure JobKeeper payments are reported correctly to the ATO.

You'll need to set up one for:

• JobKeeper topup - this is for employees earning less than the JobKeeper payment amount, or they've been stood down, who must be paid a topup to bring their taxable gross to $1,500 per fortnight.
• JobKeeper start - this is for all employees to let the ATO know when you've started paying an employee JobKeeper payments.

You only need to set up these pay items once.

This task is only applicable if you're not paying super on JobKeeper topup payments. If you will be paying super on these payments you can skip this task.

Take a look at these fortnightly pay examples to see what super is typically paid on:

To stop super calculating on the JobKeeper topup pay item

1. Go to the Payroll menu and choose Pay items. The Pay items page appears.
2. Click the Superannuation tab.
3. Click to open the Superannuation Guarantee pay item.
4. Under Exemptions, click the Add exemption dropdown button .
5. Choose the JOBKEEPER-TOPUP wage pay item.
   Here's our example:
   
6. Click Save.

The first pay you complete under the JobKeeper scheme will look quite similar to any other pay day, but with these changes:

• You'll enter $0.01 against the JOBKEEPER-START-FNxx pay item for each employee you're paying.
• You'll increase the PAYG Withholding by 1 cent to balance the pay.
• If you're paying an employee who's earned less than the JobKeeper payment, or the employee has been stood down, you'll need to enter a value against the JOBKEEPER-TOPUP pay item.

Let's take you through it:

1. Go to the Payroll menu and choose Create pay run. The Create pay run page appears.
2. Choose your Pay cycle.
3. Choose who you're paying and the pay dates. Then click Next.
4. Click the arrow to open an employee's pay.
5. Take note of the amount shown against Base Salary or Base Hourly pay items. This is typically the employee's regular income and will help you work out how to record the JobKeeper payment.

6. Enter the employee's pay.

   If an employee's pay is	Do this
   Less than the JobKeeper payment	Enter the hours or amount for the work they've done against the relevant pay item, such as Base Salary or Base Hourly. Enter the topup amount (to bring their pay up to the required JobKeeper payment amount) against the JOBKEEPER-TOPUP pay item.
   More than the JobKeeper payment	Enter their pay as you normally would against the relevant pay item, such as Base Salary or Base Hourly wage pay item.
   stood down	Enter the full JobKeeper payment against the JOBKEEPER-TOPUP pay item. Only enter the amount, not hours.

   Here are some examples:

   Example 1: Employee paid less than $750 per week.

   Here's an example of a casual employee who works 20 hours per week and whose pay is less than the JobKeeper amount ($750). For their 20 hours they earn $560 per week. Under JobKeeper, they'll now earn $750 per week so we've put their extra $190.00 against the JOBKEEPER-TOPUP pay item ($560 + $190 = $750).

   Because this is their first JobKeeper payment, we need to enter $0.01 against the JOBKEEPER-START pay item. To balance the pay, we also increase the PAYG Withholding by 1 cent ($96.00 + $0.01 = $96.01)

   

    

   Example 2: Employee paid more than $1500 per fortnight.

   Here's an employee whose pay is more than the fortnightly JobKeeper amount ($1500). They normally earn $1942.31 per fortnight. Under JobKeeper, they'll still be paid the same.

   So we'll enter their pay as we normally would and record their pay against the relevant pay item, in this case Base Salary.

   But because it's the first pay they're receiving under the JobKeeper scheme, we'll enter $0.01 against the JOBKEEPER-START pay item. To balance the pay, we'll also increase the PAYG Withholding by 1 cent ($346.00+ $0.01 = $346.01)

   

   Example 3: Employee who is stood down.

   Here's an employee who has been stood down. Regardless of what they were earning while working, they'll now receive the full JobKeeper payment.

   So in their fortnightly pay we'll enter $1500.00 against the JOBKEEPER-TOPUP pay item.

   And because it's the first pay they're receiving under the JobKeeper scheme, we'll enter $0.01 against the JOBKEEPER-START pay item. To balance the pay, we'll also increase the PAYG Withholding by 1 cent (-$356.00 - $0.01 = -$356.01)

   

7. When you're done, repeat steps 4 - 6 for each employee.

8. Finish your pays as you normally would. Need a refresher?

After an employee's first JobKeeper pay

If you've submitted the employee's first JobKeeper pay to the ATO via Single Touch Payroll reporting, you can remove the JOBKEEPER-START pay item from them.

Like this:

1. Go to the Payroll menu and choose Pay items.
2. On the Wages and salary tab, click the JOBKEEPER-START pay item.
3. Under the Employees using this pay item, deselect the employees you've paid under the JobKeeper scheme.
4. Click Save.

You will now be able to process subsequent pays in a similar way to the first pay, but without using the JOBKEEPER-START pay item.

The JobKeeper payments from the government will be deposited into your nominated bank account. Here's how to record those payments.

If you use bank feeds

The deposits from the government will automatically appear in your bank feed transactions.

If you've already recorded a Receive Money transaction for the deposit (as described below), you can match the bank feed transaction to it.

If you haven't recorded a Receive Money transaction for the deposit, you can do so straight from the Manage bank feeds page (Banking > Manage bank feeds). When creating the Receive Money transaction, allocate the deposit to the income account we set up earlier (the steps below will show you what this means).

For details about how to work with bank feed transactions, see Managing your bank feeds.

If you don't use bank feeds, you'll need to manually enter a Receive Money transaction.

To work out if any leave accrues for employees who have been stood down, you'll need to refer to the employee's stand down agreement.

If you need to record leave accruals for stood down employees you'll need to enter these values manually in the Leave accruals section of their pay.

If your employee works 38 hours per week

This table shows what you'll need to enter based on the employee's pay frequency:

Here's an example for a full-time employee who works 38 hours per week, has been stood down and is paid weekly with leave accruals entered:

If your employee works more or less than 38 hours per week

To work out the employee's leave accruals, multiply their hours worked by these figures:

Example: if your employee works 20 hours per week;

• Annual leave accrual = 20 x 0.07692 = 1.538 hours
• Personal leave accrual = 20 x 0.03847 = 0.769 hours

Need help with this? Contact us or speak to an MYOB Partner or accounting advisor.

What if I've already paid my employees since 30 March before setting up MYOB for JobKeeper payments?

No problem, there's no need to change the pays you've already done.

Just set up for JobKeeper as described above. When setting up the JOBKEEPER-START-FNxx wage category, make sure the name includes the applicable code indicating when your started making JobKeeper payments. For example, if you've already paid employees during the period 30/03/2020 - 12/04/2020, you'd name the wage category JOBKEEPER-START-FN01.

Use this table as a guide.

Do I have to pay back pay?

Because the ATO requires each eligible employee to be paid at least $1500 per fortnight, you'll need to make sure your first JobKeeper pay includes any required back pay.

Example: Fortnightly employee owed JobKeeper back pay

You have an employee whose regular fortnightly pay is $1100.

Your business became eligible for JobKeeper from 30 March (1st fortnight of JobKeeper scheme), but you already processed a pay for the employee on 10 April (before you set up AccountRight for JobKeeper). Your next pay is scheduled for 24 April (2nd fortnight of JobKeeper scheme).

You'll need to workout the amount of JobKeeper back pay you owe the employee from the previous pay and add it to their next pay.

So, if you've paid your employee their regular pay of $1100 per fortnight, your next pay will need to include the $400 JobKeeper topup back pay, as well as the $400 they would be getting for this fortnight's JobKeeper topup.

$1100 (regular pay) + $400 (JobKeeper topup backpay) + $400 (JobKeeper topup current pay) = $1900. This will bring their total gross pay to $1900.

This means $800 needs to be recorded against the JOBKEEPER-TOPUP pay item.

And because it's the first JobKeeper pay they're receiving under the scheme, we'll enter $0.01 against the JOBKEEPER-START pay item. To balance the pay, you'll need to increase the PAYG Withholding by 1 cent.

Here's our example:

If an employee becomes ineligible during the JobKeeper scheme, you'll need to create a new pay item and assign it to the employee. This lets you notify the ATO that the employee's payments are finished.

1. Go to the Payroll menu and select Pay items. The Pay items page appears.
2. Click the Wages and salary tab.
3. Click Create wage pay item. The Create wage pay item page appears.

4. For the Name, enter JOBKEEPER-FINISH-FNxx where xx refers to the fortnightly period you stopped making JobKeeper payments. Remember, the pay item name must match the Wages Name in the table below to ensure it's accepted by the ATO for Single Touch Payroll reporting. Any changes to the name may delay reimbursement.
   
   For example, JOBKEEPER-FINISH-FN08 indicates the payment applies from the 8th (06/07 - 19/07) of the 13 JobKeeper fortnights. See the following table for help.
   
   

   FN	If the employee's final pay date is within	The Wages Name must be this
   01	30/03/2020 - 12/04/2020	JOBKEEPER-FINISH-FN01
   02	13/04/2020 - 26/04/2020	JOBKEEPER-FINISH-FN02
   03	27/04/2020 - 10/05/2020	JOBKEEPER-FINISH-FN03
   04	11/05/2020 - 24/05/2020	JOBKEEPER-FINISH-FN04
   05	25/05/2020 - 07/06/2020	JOBKEEPER-FINISH-FN05
   06	08/06/2020 - 21/06/2020	JOBKEEPER-FINISH-FN06
   07	22/06/2020 - 05/07/2020	JOBKEEPER-FINISH-FN07
   08	06/07/2020 - 19/07/2020	JOBKEEPER-FINISH-FN08
   09	20/07/2020 - 02/08/2020	JOBKEEPER-FINISH-FN09
   10	03/08/2020 - 16/08/2020	JOBKEEPER-FINISH-FN10
   11	17/08/2020 - 30/08/2020	JOBKEEPER-FINISH-FN11
   12	31/08/2020 - 13/09/2020	JOBKEEPER-FINISH-FN12
   13	14/09/2020 - 27/09/2020	JOBKEEPER-FINISH-FN13

5. Choose Allowance - other as the ATO reporting category.
6. For the Pay basis, select Salary whether or not the employee is salary or hourly based.
   Here's our example:
   
7. Under the Employees using this pay item, choose the employees whose JobKeeper payments will cease prior to the end of the scheme.
8. Click Save.

When you process their last JobKeeper payment, enter $0.01 against the JOBKEEPER-FINISH wage pay item. To balance the pay, also increase the PAYG Withholding by 1 cent ($54.00 - $0.01 = $54.01).

For example:

This will inform the ATO (via Single Touch Payroll reporting) that the employee will no longer receive JobKeeper payments.