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  • Monthly business declarations for JobKeeper Fortnights in March need to be completed by 14 April 2021 to receive final JobKeeper payments. The JobKeeper Payment scheme finished on 28 March 2021.

    Test for a business affected by drought or natural disaster

    Use this test if your entity was affected by drought or another declared natural disaster during the relevant comparison period.

    You can use this test if:

    • your entity conducted business or some of your business in a declared drought or natural disaster zone during the relevant comparison period in 2019, and
    • the drought or natural disaster changed your entity’s turnover.

    For the purposes of this test, a declared drought zone includes an area subject to a formal declaration of drought by a commonwealth, state, territory or local government agency. It also includes an area for which there has been a public identification or acknowledgment that the area is drought affected by such an agency.

    For example, the following public information sources provide declarations, acknowledgments, statistics, maps and other guidance as to what are declared drought zones and drought affected areas for the purposes of this test:

    • the National Drought Map
    • Australian Government Bureau of Meteorology Monthly Drought Statements, maps, rainfall and rainfall deficiency statistics
    • in Queensland – the drought situation map
    • in NSW – the Combined Drought Indicator map
    • in South Australia – the Drought Affected Areas map.

    Alternative test

    Monthly or quarterly comparison: Calculate your entity’s current GST turnover for the month or quarter in the year immediately before the year when the drought or natural disaster was declared. You compare that figure against your applicable projected GST turnover to determine if your turnover has declined by 15%, 30% or 50% or more as applicable.

    Example 22 – Monthly comparison period

    Manu conducted his business in 2019 in a declared flood zone. He decides to use May 2020 as a turnover test period, under the basic test, and so he needs to use May 2019 to work out to see if he has the required decline in turnover. However, because he was in a declared flood zone in May 2019, he uses his entity’s current GST turnover for May 2018 instead to compare with the projected GST turnover for May 2020.

    In addition, if in May 2018, Manu’s entity was also in a declared drought or natural disaster zone, he uses his entity’s current GST turnover for May 2017 (the comparison period in the closest year in which he wasn’t in a declared drought or natural disaster zone) instead to compare with the projected GST turnover for May 2020.

    End of example

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    Test for a business that has an irregular turnover

    Use this test if your entity has a large irregular variance in its turnover for the quarters ending in the 12 months before the applicable turnover test period This excludes entities that have cyclical or regular seasonal variance in their turnover.

    You can apply this test if:

    • for the quarters ending in the 12 months immediately before the applicable turnover test period, your entity’s lowest turnover quarter is no more than 50% of the highest turnover quarter, and
    • the entity’s turnover is not cyclical.

    Your entity cannot use this alternative test if your entity’s turnover is cyclical. For example, a fruit growing business that is seasonal and usually has less turnover during certain months of the year cannot use this test. Or, for example, a business that usually has increased turnover in December from Christmas trade cannot use this test.

    Alternative test

    In applying this alternative test, you must use your entity’s average monthly current GST turnover. To work out your entity’s average monthly current GST turnover, add the total of your current GST turnovers for each whole month in the 12 months immediately before the applicable turnover test period, and divide the total by 12.

    Monthly comparison – if you use a month as a turnover test period, compare your entity’s average monthly current GST turnover with your entity’s projected GST turnover for the applicable turnover test period.

    Quarterly comparison – if you use a quarter as a turnover test period, multiply your entity’s average monthly current GST turnover by three and compare that to the projected GST turnover for the applicable turnover test period.

    Example 23 – Average monthly current GST turnover

    Zendaya’s entity had an irregular turnover in 2019. She decides to use May 2020 as the turnover test period, so she compares her projected GST turnover for May 2020 against her average monthly current GST turnover.

    Zendaya adds up her entity’s turnover for each month of May 2019 to April 2020 inclusive and divides the result by 12. This gives her the average monthly current GST turnover for the previous 12 months, which she then compares with the projected GST turnover for May 2020.

    End of example

    Drought or bushfire

    If you experienced drought or bushfire in some of the months you were going to use as your current GST entity’s turnover for the test, you exclude those months from your calculations.

    You can only do this if in the month you were going to use for your entity’s current GST turnover, your entity qualified for or received one of the following:

    • the ATO’s Bushfires 2019–20 lodgment and payment deferrals, or
    • any concessions given by us where drought has caused financial difficult, or
    • any Disaster Recovery Funding Arrangements 2018 assistance measures.

    Example 24 – Bushfire deferral

    In the example above, Zendaya calculated her entity’s average monthly current GST turnover from 1 May 2019 to 30 April 2020. She qualified for the ATO’s Bushfire 2019–20 lodgment and payment deferrals in December 2019 and January 2020, so she excludes those months from the calculation of her entity’s average monthly current GST turnover. Instead, she totals her current GST turnover from every other month and divides that number by 10.

    End of example

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      Last modified: 28 Sep 2020QC 62132