Are you eligible to claim up to $5,000?
Businesses that PAY Payroll Tax can claim up to $5,000
The Jobs Action Plan is a key priority of the New South Wales (NSW) government. The plan provides NSW businesses with a payroll tax rebate when they employ new workers in new eligible employment.
The scheme has been extended by a further 4 years to 30 June 2019 and the rebate increased from $4,000 to $5,000 for new jobs created after 1 July 2013.
Note: From 23 November 2015, late registrations for the Jobs Action Plan will only be accepted, without justification, if made within 90 days of the commencement of the new position.
To be eligible for the scheme you must be registered as an employer and paying payroll tax in NSW.
Fresh Start Support
As part of the Jobs Action Plan Rebate Scheme, the government has now added a new initiative called the Jobs Action Plan Rebate Scheme – Fresh Start Support.
The new Fresh Start Support rebate is a one-off amount of $1,000 that can be claimed at the first anniversary of an eligible employee’s employment start date.
For more information, visit the Fresh Start Support page, http://www.osr.nsw.gov.au/taxes/payroll/jap/fss
The employment of a person is included in the rebate scheme if the employment meets all of the following conditions:
- A person is employed, full-time, part-time or on a casual basis, in a position that is a new job.
- The employment commences on or after 1 July 2011.
- The employment is maintained for a period of at least 2 years, to be eligible for the full rebate.
- The services of the employee are performed wholly or mainly in NSW.
What is a new job?
A new job is created if the number of your full-time equivalent (FTE) employees increases and that FTE is maintained over a 2 year period from the creation of the new position.
If your FTE falls below the required number, for more than 30 days any time during the year, the Chief Commissioner may refuse to pay the rebate.
What types of employment are excluded from the rebate?
- The employment of a person by an employer is excluded from the rebate scheme if:
- The person was employed by the employer claiming the rebate in the previous 12 months
- Any wages paid by the employer to the person are not taxable wages (that is, the wages must be subject to NSW payroll tax under the nexus provisions)
- The employer is entitled to a rebate under the Payroll Tax Act 2007 (that is, apprentice/trainee rebate)
- A rebate, subsidy or other assistance is payable to the employer for the employment of the person by the State
- The employer is taken to be the employer of the person under the contracting provisions or employment agency provisions of the Payroll Tax Act 2007
- The employer is the Crown in right of NSW or in any of its other capacities
- The employer is a public, local or municipal body or authority.
Recent changes to excluded employment in respect of internally transferred employees
On 19 November 2014, amendments were made to the Jobs Action Plan Rebate Scheme.
Provided that the former employer was eligible for the rebate, new employers will remain eligible if:
- An employee is transferred between employers within the same group
- An employee is transferred to a new employer as a result of a merger, take over or acquisition.
Minimum employment period
To receive the Jobs Action Plan rebate, the minimum employment for the new job is 2 years starting on the date the employment is commenced.
Does the same person need to stay in the new role for the business to receive the rebate?
Employment is maintained if there is always a person employed in the position for which the rebate is claimed.
A vacancy in a position can be disregarded if the number of days vacant does not exceed a total of 30 days in each year of employment for which the rebate is claimed.
The rebate may still be paid after 30 days of vacancy, if the Chief Commissioner is satisfied the length of the vacancy is beyond the employer’s control. In this case the rebate will be paid on a pro-rata basis.
How do I register for the scheme?
You are required to register the employment of a person in a position that is a new job and advise us of the number of Full-time Equivalent (FTE) employees immediately before the position was filled.
Registration for the scheme can be made:
- By an employer who is registered for and paying payroll tax
- Within 90 days after the employment commences.
- You can apply through the Rebate Scheme (Jobs Action Plan) online registration.
How do I calculate my number of Full-time Equivalent employees?
To calculate your number of FTE employees use the following formula:
FTE = F + A/B
FTE = Full-time Equivalent
F = number of NSW full-time employees on that date
A = total number of hours worked in the preceding pay period by all NSW part-time employees employed on that date
B = average number of hours worked in the preceding pay period by all NSW full-time employees employed on that date.
To calculate the number of FTE employees:
- On the date of appointment of a person in a new job, exclude the person employed in the new job
- On the first and second anniversaries of commencing the new job, include the person employed in the new job.
The Chief Commissioner may agree to a different or compromise method of calculating the number of FTE employees if it is too difficult or costly to determine the exact figures.
Payment of the rebate
The rebate is paid by Electronic Funds Transfer in two parts, on the first and second anniversary of employment of an additional person in a new job.
Note: The maximum rebate paid for each year cannot exceed your total payroll tax liability for that year.
How much is the rebate?
First anniversary Second anniversary
1 July 2011 - 30 June 2014 $2,000 $2,000
1 July 2013 - onwards $2,000 $3,000
The Fresh Start Support rebate is a one off amount of $1,000, payable from 1 January 2014 on the first anniversary.
In the case of part time employees, the rebate payable on each anniversary is:
Annual rebate amount x C/D, where:
C = the number of hours worked by the employee during the previous 12 months
D = the average number of hours worked by full time employees during the previous 12 months.
The maximum amount of rebate payable per FTE employee to an employer should not be reduced if the payroll tax attributed to a particular new employee’s wages is less than the rebate.
How do I apply for the rebate?
Through the Rebate Scheme (Jobs Action Plan) online claim:
By submitting an application for the payment of the rebate in respect of the employment of a person.
An application for rebate may be lodged:
- Within 30 days after the end of the year of employment
- If the employment is eligible employment.
Are there any conditions for the payment of the rebate?
There are certain conditions that apply to the payment of the rebate, including:
- The maximum amount of rebate payable per FTE employee to an employer should not be reduced if the payroll tax attributed to a particular new employee’s wages is less than the rebate.
- For part time employees, the rebate will be pro-rated based on FTE hours of employment
- If the increase in the FTE is not maintained for the second year, you will not be required to repay the rebate for the first year of employment.