The government has provided further guidance in relation to the Job Retention Bonus (“JRB”), which was introduced as part of the Chancellor’s ‘Plan for Jobs’ on 8 July 2020.
So if you are an employer and have furloughed staff and received a Coronavirus Job Retention Scheme (“CJRS”) grant or intend to claim for employees using the new Job Support Scheme (“JSS”) then you may be entitled to receive a £1,000 bonus for each eligible employee.
Claims for JRB cannot be submitted until 15 February 2021.
What is JRB?
JRB is a one-off taxable payment made by the government to employers of £1,000 for each eligible employee.
Employers can keep the bonus and are not required to pay it to the eligible employee.
Which employers are eligible?
All employers are eligible for JRB provided they:
- hold a UK bank account;
- remain enrolled for PAYE online;
- comply with PAYE obligations to file PAYE accurately and on time under Real Time Information reporting for all employees between 6 April 2020 and 5 February 2021;
- keep payroll up-to-date and ensure they report the leaving date for any employees that stop working for them before the end of the pay period that they leave in;
- use the irregular payment pattern indicator in Real Time Information for any employees not being paid regularly; and
- comply with all requests from HMRC to provide any employee data for past CJRS claims.
Who are eligible employees?
Eligible employees are employees who:
- were furloughed and had an eligible CJRS claim submitted by the employer;
- are kept continuously employed from the end of the claim period of the last CJRS claim until 31 January 2021;
- were paid enough to meet the minimum income threshold; and
- are not serving a contractual or statutory notice period on 31 January 2021 (this includes people serving notice of retirement).
Employers can claim JRB for individuals who are not employees, such as office holders or agency workers, as long as the other requirements are met.
It has been stated that Employers can still claim the JRB if they make a claim for that employee through the new Job Support Scheme but further details are awaited.
Employers cannot claim JRB for any employees for whom they have repaid (for whatever reason) all the CJRS grant amounts claimed for that employee.
What is the minimum income threshold?
The employer must have paid the employee a total of at least £1,560 (gross) between 6 November 2020 to 5 February 2021.
At least one payment of taxable earnings must be received by the employee in each of these tax months.
Only payments recorded as taxable pay will count towards the minimum income threshold.
How can employers claim?
Employers will be able to claim the bonus between 15 February 2021 and 31 March 2021 – guidance will be updated by the end of January 2021 with details on how to access the online claim service on GOV.UK.
JRB will close after 31 March 2021 and no further claims will be accepted after this date.
Tax treatment of JRB
Employers must include JRB payments they receive as income when calculating taxable profits for Corporation Tax purposes (if the employer is a corporate entity) or Income Tax purposes (if the employer is not a corporate entity).
The contents of this article are intended as guidance for readers. It can be no substitute for specific advice. Consequently we cannot accept responsibility for this information, errors or matters affected by subsequent changes in the law, or the content of any website referred to in this article. © Mundays LLP.