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ATO ruling on JobKeeper GST turnover test released


The Tax Office has now published a Law Companion Ruling on the JobKeeper basic decline in turnover test, setting out its view on various methods to calculate GST turnover.

By Jotham Lian 12 minute read

LCR 2020/1 has now been published, setting out the Tax Commissioner’s view of the decline in turnover test as part of the JobKeeper rules.

“The reason for this ruling is that we are continuing to receive questions about some aspects of the turnover test that require further explanation in a product of this type,” the ATO said.

“It is intended to assist those who have not yet applied the turnover test and are still considering if they are eligible for JobKeeper.


“It is not our intent to focus compliance resources on circumstances where you have already used guidance on our website in good faith to determine whether you satisfy the decline in turnover test.”

The ruling aims to provide clarity to practitioners and clients by working through a three-step process — namely determining what supplies are relevant when calculating projected GST turnover and current GST turnover; how supplies are allocated to relevant periods; and how to determine the value of each supply that has been allocated to a relevant period.

The ATO’s compliance approach has also been included, in recognition of the difficulty that certain entities may face in applying the law.

The ruling also touches on the cash or accruals approach in calculating turnover, and sets out the alternative methods that the commissioner will allow to allocate supplies to a relevant period and determine the value of those supplies.

“We accept that there may be practical compliance difficulties in linking amounts you have received or invoiced based strictly on the time a supply is made or likely to be made,” the ATO said.

“Accordingly, this ruling outlines alternative methods which, if applied in good faith, we accept can be used as a proxy for determining the value of supplies were made or likely to be made in a relevant period.”

You can view LCR 2020/1 here.

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Jotham Lian

Jotham Lian


Jotham Lian is the editor of Accountants Daily, the leading source of breaking news, analysis and insight for Australian accounting professionals.

Before joining the team in 2017, Jotham wrote for a range of national mastheads including the Sydney Morning Herald, and Channel NewsAsia.

You can email Jotham at: This email address is being protected from spambots. You need JavaScript enabled to view it. 

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