COVID-19: Guidance on the £1,000 Coronavirus Job Retention Bonus

As the Coronavirus Job Retention Scheme (CJRS) begins to wind down with the end date of 31 October fast approaching, businesses that have availed of the CJRS are now starting to consider whether they are eligible to receive the Coronavirus Job Retention Bonus (CJRB). The CJRB aims to provide additional support to employers in the form of a one-off £1,000 payment for each furloughed employee retained in employment from the end of the scheme until at least the end of January 2021.

Further information has been released by the government outlining how the CJRB will work in practice.  The key elements of the CJRB are as follows:

• All employers are eligible for the scheme, including recruitment agencies and umbrella companies.
• Employers should ensure that they have:
  • complied with their obligations to pay and file PAYE accurately and on time under the Real Time Information (RTI) reporting system for all employees.
  • maintained enrolment for PAYE online.
  • a UK bank account.
• Employers must keep their payroll up to date and accurate and address all requests from HMRC to provide missing employee data in respect of historic CJRS claims. Failure to maintain accurate records may jeopardise an employer’s claim.
• HMRC will withhold payment of the CJRB where it believes there is a risk that CJRS claims may have been fraudulently claimed or inflated until the enquiry is completed.
• 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 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 (a total of at least £1,560 across the 3 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 RTI.
  • have up-to-date RTI records for the period to the end of January.
  • are not serving a contractual or statutory notice period, that started before 1 February 2021, for the employer making a claim.

From February 2021, employers will be able to claim the CJRB through GOV.UK. More detail about this process will be published in guidance by the end of September 2020. The £1,000 bonus will be taxable, so employers must include the whole amount as income when calculating taxable profits for Corporation Tax or Self-Assessment.

What should employers do now?

Employers should 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 Real-Time Information (RTI) reporting system. Employers should also make sure all of their Coronavirus Job Retention Scheme claims have been accurately submitted and any necessary amendments have been notified to HMRC.

This article has been produced for general information purposes and further advice should be sought from a professional advisor. Please contact our Employment team at Cleaver Fulton Rankin for further advice or information.