JobKeeper claims for sole traders

Author: Holding Redlich partner Sue Williamson, partner Damien Bourke and associate Paul Thompson
Publication: Queensland Country Life (Australia)
Publisher: Fairfax Media
Publication date: 13/11/2020

Sole traders who have been denied JobKeeper should be aware that the Administrative Appeals Tribunal (Tribunal) is currently considering whether the Commissioner of Taxation’s (Commissioner) approach in denying certain JobKeeper claims is valid. If you had your JobKeeper claim denied, you should check to see if you need to do anything to protect your rights pending the outcome of the case.

Under the JobKeeper legislation, sole traders may be eligible to receive JobKeeper payments if they are carrying out a business enterprise, meet other tests and have had a decrease to their turnover of at least 30 per cent compared to the previous year. In circumstances where an applicant does not meet certain statutory tests, the Commissioner has the discretion to allow applicants further time to satisfy the tests. 

We are representing a sole trader (Applicant) fighting to receive JobKeeper payments. The Applicant’s business turnover declined by more than 30 per cent due to the impact of the coronavirus, but the Commissioner refused to register the Applicant on the basis that he did not have an ABN on 12 March 2020. This was an oversight by the Applicant as he failed to reactivate it in July 2019 when he recommenced his business. However, the Applicant reactivated the ABN in late March 2020, with an effective date recorded in the Australian Business Register of July 2019. 

The Applicant also asked the Commissioner to exercise his discretion to extend the time for having an ABN to fully protect his position. The request was denied. 

The case was brought to the Tribunal for a review into the Commissioner’s decision that the Applicant was ineligible for JobKeeper. It is expected that the Tribunal will provide guidance on issues affecting a number of sole traders who have been denied JobKeeper including:

• what it means to have an ABN on 12 March 2020
• what factors the Commissioner should take into account when exercising his discretion to allow further time for applicants to do various things to enable them access to JobKeeper payments
• whether the Tribunal has the power to review the decisions made by the Commissioner in relation to the exercise of his discretion.

The decision of the Tribunal might help sole traders who feel that they have been unfairly denied JobKeeper payments. For example, the Commissioner has denied JobKeeper payments because he incorrectly maintained the applicant did not have an ABN on 12 March 2020 or the Commissioner has refused to grant further time to disclose business income or obtain an ABN. Those affected should check that they have protected their rights to challenge the decisions made so that they can take advantage of the outcome of the case if it is positive for the Applicant.

© 2019 Thomson Reuters. No claim to original U.S. Government Works.

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