Advice: JobKeeper Documentation

Updated May 21st 2020

Bradley Ross

Many businesses have already enrolled in the JobKeeper program and have started to receive their first payments.  The speed at which the system had to be implemented so that payments could start flowing meant that the Tax Office didn’t have the time to build in many cross checks to ensure that only eligible businesses applied. 

This doesn’t mean that they won’t start investigating claims once things settle down.

It is anticipated that review activity will start in a couple of months time and those business who have large claims or have significant variance in declines in revenue compared to similar businesses in the same industry will be the first to be targeted. 

In line with the Tax Offices’ declaration, that they will take an “understanding and sympathetic” approach to compliance when reviewing JobKeeper claims, the initial reviews are likely to be an information gathering exercise to understand if businesses are doing the right thing.  Based upon these initial audits, the Tax Office will expand its compliance program to target those businesses who they suspect may have been claiming when they shouldn’t have and will start to enforce the letter of the law.

It is important that businesses document exactly how they determined their eligibility and what supporting information they used in making that determination.  Where projections have been relied upon to determine eligibility, it is critical that those projections are supported by detailed assumptions.  The documentation needs to cover not only how you determined the eligibility of the business itself, but also of each individual employee that you made a claim for.  Essential to this will be retaining copies of the declarations from the employee that you are the only employer claiming JobKeeper on their behalf.  

Documentation that is coherent and cogent will be the best defense against a review by the Tax Office.

Whilst the application process is still fresh in everyone’s mind and the information used to determine eligibility is at hand, we recommend that clients get their documentation in order now.  This will avoid having to regenerate supporting information or remember what assumptions you used in your forecasts when a review happens. 

In the event that the Tax Office conducts a review, these documents can be quickly provided to explain everything and hopefully the auditor will say “thank you very much” and be on their merry way.  Putting a bit of effort now could save you a greater amount of time and money down the track.

If you have concerns with documentation, contact your CIB Adviser for urgent assistance.