Don't Make This Big Mistake When you apply for JobKeeper
“If accountants are advising to add directors on the payroll, is it wise to get their instructions in writing?”
Here’s what we suggest. We received an email from the Tax Practitioners Board regarding the response to COVID-19 saying,
"Some advisers may be grappling with the tax consequences associated with the stimulus payment and wondering what will attract our attention. We also know that some businesses are already making changes to their business structures and employment arrangement following the stimulus announcements.
We ask that tax agents and businesses be mindful that it is not acceptable to backdate or artificially change your business structure or employment arrangements including changing the characteristics of payments in order to obtain a benefit or payment that would otherwise not have been paid. The Tax Practitioners Board and the ATO will take firm and swift action should this be the case."
This email could not be more black and white. What is clear is that the ATO will come after you should you wish to change things in terms of your employment status on the payroll, changing from trusts to companies, or take your drawings as salaries.
The ATO can easily find this information by simply looking at the differences in your payroll this year versus last year. If the accountant is saying you can do it, that's their own tax agent registration at risk. We advise a strong "no."
If there is a downturn you are experiencing but not sure what you can receive in the JobKeeper payment, talk to an accountant who has read and been across everything JobKeeper. You don't want to be caught in the crosshairs of the ATO.