Small Business Grant
The Small Business Grant is designed to encourage small businesses, not liable for payroll tax, to employ new full-time, part-time and casual workers.
If you increase the number of NSW full-time equivalent (FTE) employees in your business, you’ll receive a grant.
The grant is up to $2,000 per full-time equivalent position at the anniversary date. You need to register for the grant within 60 days of the employee’s start date. Claim your small business grant New job
A new job is when the number of NSW FTE employees increases and is maintained over a 12 month period.
Any new job created on or after 1 July 2015 and before 1 July 2019 can be registered for the grant.
A full-time job is a position where an employee’s standard or average hours worked per week is 35 hours or more. A casual employee who works a standard or average of 35 hours or more per week is considered a full-time employee for the purposes of the grant.
Your business is still eligible for the grant even if the person you employ for the new job is a part-time or casual employee. If they do not work full-time, the grant amount will be paid as a pro-rata amount based on the FTE hours of employment.
We may refuse to pay the grant if the number of NSW FTE employees decreases for more than 30 days during the grant period.
Scheme end date
The end date of the scheme is 1 July 2019. You must register any new jobs before this date to be eligible for the scheme.
Here's what you need to know.
The minimum employment period is 12 months from the start date of the new job. This is also known as the grant period and is generally spread across two financial years.
Under the grant, there must always be a person employed in the job. If a position is left vacant for less than 30 days within the 12 month period it is not considered a vacancy. However, if the 30 days are exceeded this position is not eligible for the grant.
A position is eligible for the grant if
it is newly created the person is employed, full-time, part-time, on a permanent or casual basis it starts on or after 1 July 2015 and before 1 July 2019 it’s maintained for a period of 12 months your number of FTE employees, prior to creating a new job, increase and is maintained for 12 months the employee performs more than 50 per cent of their services in NSW.
A position is not eligible for the grant if
the person employed by your business is not considered a common law employee the person you or one of your group members employ was already employed in that role or a different role within your business in the last 12 months any wages paid by you to the person are exempt wages within the meaning of the Payroll Tax Act 2007 your business already receives a rebate, subsidy or other assistance from the State for the employment of the person you are the Crown or a body representing the Crown in NSW you are a public, local or municipal body or authority.
Only workers you engage as
employees are eligible for the grant.
An employee works in your business and is part of your business, whereas a contractor runs their own business and provides services to your business. Contractors and employment agency workers are not considered employees.
You’re not eligible for the grant if you pay wages to employees working in a:
religious institution public benevolent institution non-profit organisation whose objectives are solely or dominantly for charitable, benevolent or philanthropic or patriotic purposes public hospital non-profit hospital carried on by a society or association public/private school or educational institution that provides education at the secondary level or below non-profit group training organisation (GTO) approved by the Director-General of the Department of Education and Communities.
Calculating your FTE employees
You will need to calculate your FTE employees. Use the following formula:
F + (A ÷ B) = FTE
F = the number of NSW full-time employees on that date A = the 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
When calculating the number of FTE employees
on the date a person starts in a new job, exclude that person from the calculations on the first and second anniversaries of the start date of the new job, include that person in the calculations
If you have different pay periods for various employees, you will need to choose and apply it consistently to all employees.
The Chief Commissioner of State Revenue may agree to a different or compromise method of calculating the number of FTE employees if it too difficult or costly to determine the exact figures.
How it works
To claim the grant you’ll need to
lodge an online application for payment within 60 days after the 12 month anniversary date. Supporting evidence
When claiming the grant you must provide supporting evidence including (but not limited to)
the most recent payslip before the anniversary date PAYG payment summary (group certificate) relating to the financial year that falls within the 12 month grant period.
We may ask for other evidence in some cases.
Note: Tax file numbers must be removed from all supporting documentation submitted.
The grant is a one off payment for each new job, and is paid by electronic funds transfer when a claim is approved.
For full-time employees, the grant amount is $2,000. In the case of part-time or casual employees, the grant amount will be paid on a pro-rata basis calculated on the FTE hours of employment.
The amount payable on the anniversary equals:
The annual grant amount x (the number of hours worked by the employee in the previous 12 months / the average number of hours worked by fulltime employees during the previous 12 month)
Becoming liable for payroll tax
If your wages exceed the
payroll tax threshold, you may become liable for payroll tax before your new job’s first anniversary. This means you are no longer eligible for the grant.
You may be eligible for the
jobs action plan (JAP) rebate if
You’ll also need to
register for payroll tax when you become liable, or before the first anniversary of the new job. Example: Small Business Grant to Jobs Action Plan An employer hired an employee in a new role in August. At that time the employer was not liable for payroll tax and the role was registered under the small business grant. In January the employer became liable for payroll tax, and in February registered and began paying payroll tax. The following August the employer’s claim for the grant was rejected because they were paying payroll tax. The number of FTE’s increased but as they met all other eligibility criteria for the grant and jobs action plan, their registration was transferred to jobs action plan.
If you think this scenario applies to you,
email us with an explanation of your situation.