Background
At the beginning of July, the Chancellor of the Exchequer announced a number of measures relating to his “Plan for Jobs”. One of these measures, the Job Retention Bonus (“JRB”), was broadly outlined as a one-off payment to employers of £1,000 for every employee who remains in employment having previously been furloughed.
The JRB is intended to be an incentive for employers to keep staff in meaningful employment as lockdown eases and the job retention scheme comes to an end (31st October).
Detail
HMRC have recently published guidance giving more information for employers on the employees they can claim for and when they will be able to make a claim.
One of the important points reiterated in the guidance is that an employer can only claim a JRB in respect of a particular employee if the employer has previously made a claim under the job retention scheme for that individual and the individual continues to be employed by that employer until 31st January 2021.
Which employers can make a claim?
All employers can claim the JRB where they claimed a job retention scheme grant for any of their employees. If a claim for an employee was incorrectly made, the bonus will not be available. Employers should ensure:
- They have complied with their obligations to pay and file PAYE accurately and on time under RTI filing obligations
- They have a UK bank account
- They have complied with any outstanding HMRC requests for information
If HMRC have reason to believe that job retention payments have been claimed fraudulently, bonus payments may be withheld or delayed.
Which employees can employers claim for?
Once an employer has concluded that they are an eligible employer, they claim the bonus for each eligible employee. An eligible employee is determined by a number of conditions as follows:
- The employee was furloughed and a claim was successfully submitted for them under the job retention scheme
- The employee must have been continuously employed from the time of the employers most recent claim for that employee until at least 31st January 2021
- The employee must have been paid an average of at least £520 per month between 1st November 2020 and 31st January 2021. The employee does not have to have been paid £520each month but must have received some earnings that have been paid and reported to HMRC via RTI in each month
- The employer must ensure they have an up to date employee RTI record up to the end of January 2021
- The employee cannot be serving a contractual or statutory notice period that started before 1 February 2021.
The guidance clarifies the point that office holders, company directors and agency workers can all be eligible workers providing they meet the above conditions.
How can employers claim the Job Retention Bonus?
Claims can be made from February 2021 from the gov.uk website and more guidance will be published from next month to explain the process for making a claim. We would recommend that any employers considering making a claim reads through this bulletin in conjunction with the government guidance to ensure they are fully compliant with all conditions.
Finally, to make it clear, the bonus is a one-off £1,000 payment payable to employers for each eligible employee. The bonus will be taxable and so would be included as income when calculating taxable profits for corporation tax or self-assessment.
Our updated working arrangement – We remain ‘Open for business’
Our staff are continuing a return to office based working on a rota basis, each attending two/three days a week, whilst continuing to work from home at other times. They can still be contacted in the usual way either via email or by calling the office number where reception will divert your call to the appropriate staff member.
If you would like more information or if you require our assistance in ensuring your eligibility for the Job Retention Bonus, please speak to your usual contact at the firm.
To see our other news items please visit our Muras Baker Jones – Blog.