Guidance on furlough job retention bonus

 HMRC has published guidance on how businesses can claim the government's job retention bonus, available to employers who keep furloughed workers on the payroll for the next three months. The bonus is a £1,000 one-off taxable payment to the employer, for each eligible employee that was furloughed and kept continuously employed until 31 January 2021. 

 

Employers will still be able to claim under the scheme even if they are also receiving support from the new job support scheme which will launch on 1 November.

 

The bonus is available to any employer who has furloughed employees and made an eligible claim for them through CJRS. The employee must have been eligible for the CRJS grant for the employer to be eligible for the bonus, and it is not payable to any employer who has repaid a CJRS grant.

 

The guidance details the arrangements for employees who have been transferred from another employer, and those who are not employees but classified as office holders or agency workers.

 

There is a minimum income threshold the employer must pay the employee. This is a total of at least £1,560 (gross) throughout the tax months 6 November to 5 December 2020; 6 December 2020 to 5 January 2021; and 6 January to 5 February 2021.

 

Before employers can claim the bonus, they will need to have reported all payments made to employees between 6 November 2020 and 5 February 2021 to HMRC through full payment submissions via real time information.

 

Businesses must include payments they receive under the scheme as income when calculating their taxable profits for income tax and corporation tax purposes, but can deduct employment costs as normal.

 

Individuals with employees that are not employed as part of a business (such as nannies or other domestic staff) will not have to pay tax on grants received under the scheme.

 

The scheme will not open for claims until 15 February 2021, and employers will have until 31 March 2021 to make a claim after which the scheme will close.

 

The guidance will be updated by the end of January 2021 with details on how to access the online claim services.

 

 

Blog post uploaded 7 Oct 2020