As church income drops, the wage subsidy scheme kicks in

“Our church’s giving is a bit rocky” was a comment Eternity heard this morning. That church has seen its income drop by 30 per cent, as physically meeting as a church has ceased. The significant drop is because the older members gave in cash at church services.

We also heard of another church where distributing electronic deposit forms was not going to work – the members are too old.

The $1500 a fortnight wage subsidy – known as the JobKeeper Payment, introduced yesterday by the Federal Government – applies to “Not-for-profit entities (including charities) and self-employed individuals (businesses without employees) that meet the turnover tests that apply for businesses.”

The turnover tests relevant to churches is “a turnover of less than $1 billion and their turnover will be reduced by more than 30 per cent relative to a comparable period a year ago (of at least a month).”

Many churches will be monitoring their giving as the new way of meeting proceeds –  but any church with automatic payments from members of 70 per cent or more is unlikely to be eligible.

For many smaller churches, though, using the JobKeeker Payment becomes a real possibility.

“The employer must have been in an employment relationship with eligible employees as at 1 March 2020 , and confirm that each eligible employee is currently engaged in order to receive JobKeeper Payments,” the official site says.

As the scheme is being run through the ATO, the employer will be the entity that is registered as paying the pastor or minister’s wages. This means the new scheme will work with the ATO’s existing system and information, which greatly simplifies setting it up.

Some Christian groups maintain that their minister or pastors are not employees. For example, many Anglican clergy will say they “hold an office” rather than being employed by their local church or diocese (region).

But unless they have been operating outside the tax system, there will be an employer listed with the ATO who is their employer of record. And that’s who can apply for the subsidy.

According to Peter Martin, Business Economics editor of The Conversation, the scheme will work in retrospect. Which means that businesses or non-profits that have lost money from March 1, can ask for subsidies that date from then.

And for the low paid “It gets better. If you have been part-time, or for some other reason on less than $1,500 per fortnight, ‘your employer must pay you, at a minimum, $1,500 per fortnight, before tax’.

This means you’ll get a pay rise, for the six months the scheme lasts.” Martin says.

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