Suitable for: Anyone wants more information on Supporting Apprentices and Trainees Wage Subsidy

Tax Difficulty: Intermediate

Airtax Experience: First time users

Time to read: 3-5 minutes

Overview of the Supporting Apprentices and Trainees Wage Subsidy

As part of the federal government’s COVID-19 pandemic support package for businesses, the Supporting Apprentices and Trainees Wage Subsidy was announced. 

Employers who meet the eligibility criteria can apply for a wage subsidy of 50% of the wages they would normally pay to apprentices and trainees paid during the nine months from 1 January 2020 to 30 September 2020.

You might be aware of other initiatives, such as the Australian Apprentice Wage Subsidy, which was rolled out in 2019 to support employers with apprentices in rural and regional areas. 

Please note that these two initiatives are separate. The latest COVID-19 assistance will support up to 70,000 small businesses employing around 117,000 apprentices and trainees across the country.

What are the Eligibility Requirements for the Supporting Apprentices and Trainees Wage Subsidy?

To qualify, 

• You must be operating a small business employing fewer than 20 employees 
• You must retain an apprentice or trainee as part of your workforce
• Any apprentice(s) or trainee(s) are required to have been with your business and in-training at 1 March 2020 (they won’t be eligible if they were hired after this date)

What if you can’t retain an apprentice?

As a small business owner, if you’re unable to keep an apprentice(s) on your team, the subsidy will go to another employer. This can be another small business employer or a larger employer, including Group Training Organisations. 

What is the value of the subsidy?

If you and your employees meet the eligibility criteria, you can be reimbursed up to $7,000 per quarter per eligible apprentice or trainee or a maximum of $21,000 for the entire nine month period (from 1 January 2020 to 30 September 2020).

How do I access the subsidy?

It is the employer’s responsibility to complete the application to access the subsidy. To do so, you will need to complete an eligibility assessment undertaken by your Australian Apprenticeship Support Network (AASN) provider. 

The process is relatively straightforward - all that is required is to complete a claim form and provide documentation, including pay records for eligible employees and a copy of the training plan (signed by you and the apprentice). With this, the AASN provider will confirm your eligibility. Be aware that this information could vary depending on your State. 

Registrations opened in April 2020. Final claims can be lodged by 31 December 2020.

As an employer, is there a limit on the number of Supporting Apprentices and Trainees Wage Subsidies I can access?

Great news - there is no limit. As long as the eligibility criteria are met, you can receive the Supporting Apprentices and Trainees Wage Subsidy for any number of apprentices or trainees.

Changes to the Australian Apprenticeships Incentive Program (AAIP)

You may have been keeping up to date with the new employer incentives packages which were announced to help simplify the various incentives which was going to replace the AAIP with the new program called the IAA or the Incentives for Australian Apprenticeships. However, given the recent changes with COVID, the rest of the changes under the IAA have been deferred until 1 January, 2021. 

Further Information about Apprentices and Wage Subsidy

If you want to find out more information on who is eligible for the Supporting Apprentices and Wage subsidy then the Department of Education, Skills and Employment website is a great start. 

There is also more information on the Treasury Website. 

Where you can get more help:

• Feel free to search for other topics in the Help Centre
• If interested, consider using our Business Assist service to discuss with a qualified Tax Specialist about your BAS (recommended for first time users)

• If you want to speak to someone about your current Airtax income tax return, book in a Tax Assist call or Tax Professional call with a tax specialist.

This document merely provides a broad outline of the subject and is necessarily general in nature.  If you require specific advice, which is tailored to your specific circumstances, please do not hesitate to contact us (fees would apply).