The government has published further guidance on how the forthcoming Job Retention Bonus Scheme will operate. The scheme will enable eligible employers to claim £1,000 for each eligible employee in respect of whom they have previously made a valid claim under the Coronavirus Job Retention Scheme (CJRS) and who remains in continuous employment until at least 31 January 2021 following the closure of the CJRS on 31 October 2020.
The policy paper indicates that the one-off bonus payment is intended to provide additional support to employers who keep on their furloughed employees in “meaningful employment” after the CJRS ends and it states that further detailed guidance on the operation of the scheme will be published in September 2020.
Employers will be able to claim the bonus via GOV.UK after they have filed PAYE for January 2021 and payments will be made from February 2021.
Employers will be able to claim for employees who:
- were furloughed and had a CJRS claim submitted for them that meets all relevant eligibility criteria for the scheme
- have been continuously employed by the employer from the time of the employer’s most recent claim for that employee until at least 31 January 2021
- have been paid an average of at least £520 a month between 1 November 2020 and 31 January 2021, i.e. a total of at least £1,560 across the three months – the employee does not have to be paid £520 in each month, but must have received some earnings in each of the three calendar months that have been paid and reported to HMRC via Real Time Information (RTI), and only earnings recorded through RTI records can count towards the average minimum earnings threshold
- are not serving a contractual or statutory notice period that started before 1 February 2021
- have up-to-date RTI records for the period to the end of January 2021.
HMRC will withhold payment of the bonus where it believes there is a risk that CJRS claims may have been fraudulent or inflated, until the enquiry is completed.
The bonus will be taxable, so employers must include the whole amount as income when calculating the taxable profits for Corporation Tax or Self-Assessment.
Employers should now ensure that their employee records are up-to-date, including accurately reporting their employee’s details and wages on the Full Payment Submission (FPS) through the RTI reporting system. They should also ensure all their CJRS claims have been accurately submitted and that any necessary amendments have been notified to HMRC.