Coronavirus Job Retention Bonus

On the 8 July 2020 the Chancellor of the Exchequer, Rishi Sunak, announced during his summer statement that employers will receive a £1,000 “Job Retention Bonus” for every worker they bring back from furlough and continue to employee until January 2021. On the 31 July 2020 the Government published guidance on the Job Retention Bonus.

Overview Of The Job Retention Bonus

UPDATES

Updated guidance is released regularly and I will update this page as more details are announced.

This page was firstly published on 5 August 2020 and the last update was 14 August 2020.

The Job Retention Bonus is a one-off taxable payment of £1,000 which employers can claim for all employees, including office holders, company directors, agency workers and those employed by umbrella companies, who they previously claimed for under the Coronavirus Job Retention Scheme, and who remain continuously employed through to 31 January 2021.

All employers are eligible for the Job Retention Bonus including recruitment agencies and umbrella companies.

Where a claim for an employee was incorrectly made, a Job Retention Bonus will not be payable.

Which Employees Qualify For The Job Retention Bonus?

Employers will be able to claim for employees who:

  • Met the eligibility criteria for furlough, and were furloughed, under the Coronavirus Job Retention Scheme;
  • Were furloughed and had a Coronavirus Job Retention Scheme claim submitted for them;
  • Were continuously employed since the most recent Coronavirus Job Retention Scheme claim for that employee through to 31 January 2021;
  • Were paid an average of at least £520 per month between 1 November 2020 and 31 January 2021 (a total of at least £1,560 across the 3 months). Only earnings recorded through HMRC Real Time Information (RTI) records count towards the average minimum earnings threshold; and
  • Are not serving out a contractual or statutory notice period that started before 1 February 2021 for the employer making the claim.

In addition to the above the employer must have up to date HMRC Real Time Iinformation records in respect of the employee for the period to the end of January 2021.

Employers can claim the Job Retention Bonus for all employees who meet the above criteria, including office holders, company directors and agency workers, including those employed by umbrella companies. The above criteria must be met regardless of the frequency of the employee’s pay periods, their hours worked and rate of pay.

The Government Guidance also confirms that claims for the Job Retention Bonus can be made in respect of:

  • Employees of a previous business which were transferred to a new employer under TUPE regulations or PAYE business succession rules, as long as the transferred employees were furloughed and successfully claimed for under the Coronavirus Job Retention Scheme by their new employer before 31 October 2020.
  • Employees who were on statutory parental leave or mobilised as a military reservist, who returned from that leave or period of mobilisation after 10 June 2020 and were claimed for under the Coronavirus Job Retention Scheme.
  • Fixed term employees who the employer claimed for under the Coronavirus Job Retention Scheme.

Making The Claim

Employers will be able to claim the Job Retention Bonus after they have filed PAYE for January 2021 and payments will be made to employers from February 2021.

The Government has confirmed that employers will be able to claim the bonus through the gov.uk website from February 2021. More guidance is expected on how to claim by the end of September 2020.

In order to make a claim you should ensure:

  • That all Coronavirus Job Retention Scheme claims have been, and continue to be, accurately submitted (notifying HMRC of any necessary amendments); and
  • That your employee records are up-to-date, including accurately reporting your employee’s details and wages on the Full Payment Submission through the RTI reporting system.

To actually submit a claim you will need to have:

  • complied with your obligations to pay and file PAYE accurately and on time under the RTI reporting system for all employees;
  • maintained enrolment for PAYE online; and have
  • a UK bank account.
You must address all requests from HMRC to provide missing employee data in respect of historic Coronavirus Job Retention Scheme claims. Failure to maintain accurate records may jeopardise your Job Retention Bonusclaim.

Fraudulent Coronavirus Job Retention Scheme Claims?

HMRC will withhold payment of the Job Retention Bonus where it believes there is a risk that Coronavirus Job Retention Scheme claims may have been fraudulently claimed or inflated, until the enquiry is completed.

Read about the HMRC Furlough Fraud Confession Window.

How Should The Job Retention Bonus Payment Be Recorded?

The payment is taxable, so you must include the whole amount as income when calculating your taxable profits for Corporation Tax or Self-Assessment.

If you have any questions please call me on 0114 360 0626 or simply email me at enquiries@kea-hr.co.uk.

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Coronavirus Job Retention Bonus