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Job Retention Scheme Bonus Guidance

The government have today (2nd October) issued further guidance around the Coronavirus Job Retention Bonus scheme, previously announced as part of the Chancellor’s “Plan for Jobs” back in July.

What is the Job Retention Bonus?

The Job Retention Bonus is a one-off, taxable incentive bonus payment of £1,000 paid to employers for every previously furloughed employee who has been continuously employed by the business until at least 31 January 2021.

When do applications for the JRS Bonus open?

Applications for the one off bonus payments open on the 15th February 2021, and close on 31 March 2021.

Who is eligible for the JRS Bonus?

Employers who have previously furloughed eligible employees, have submitted an eligible claim for them through the furlough scheme, and kept that employee continuously employed until at least 31 January 2021, will be eligible for the bonus.

If an employer has previously submitted a furlough claim, but subsequently repaid all of that grant, are not eligible for the bonus for that particular employee.  The bonus will not be payable in the event of an incorrect CJRS claim, whereby the employee was not in fact eligible for the furlough grant.

Furloughed employees must have also met the minimum income threshold (see below).

Can I claim the JRS Bonus for TUPE’d Employees?

Employers may still be eligible for the bonus where employees of a previous business (who met the relevant eligibility criteria for furlough) have been transferred under the TUPE rules, where PAYE business successful rules applied, and the employees were associated with the transfer of a business from the liquidator of a company in compulsory liquidation where TUPE rules would have applied if it were not for the company being in compulsory liquidation, providing that those employees were furloughed and successfully claimed for prior to the closure of the furlough scheme on 31 October 2020.

Can I claim the JRS Bonus for non-employees?

Providing that a previous furlough claim has been made in respect of office holders and agency workers then the bonus scheme will also be payable.

What is the minimum income threshold for the JRS Bonus?

To be eligible for the bonus employees must have been paid at least the minimum income threshold.

To satisfy the minimum income threshold, employees must be paid a total of at least £1,560 (gross) throughout the following tax months:

  • 6 November to 5 December 2020
  • 6 December 2020 to 5 January 2021
  • 6 January to 5 February 2021.

Employees must have received at least one payment of taxable earnings (of any amount) in each of the relevant tax months.

The minimum income threshold criteria apply regardless of:

  • How often employees are paid
  • Any circumstances that may have reduced an employee’s pay in the relevant tax periods, such as being on statutory leave or unpaid leave.

HMRC will check that employees have been paid at least the minimum income threshold via information submitted through Full Payment Submissions via Real Time Information (RTI).

Only payments recorded as taxable pay counts towards the minimum income threshold.

What actions are required to claim the JRS Bonus?

Employers will need to:

  • Have reported all payments made to employees to which the JRS bonus applies between 6 November 2020 and 5 February 2020 to HMRC through Full Payment Submissions via the RTI Scheme
  • Be still enrolled for PAYE online
  • Comply with their PAYE obligations to file PAYE accurately and on time under RTI reporting for all employees between 6 April 2020 and 5 February 2021
  • Keep their payroll records up to date and ensure the leaving date for any employees that have stopped working for the employer before the end of the pay period that the leave in is reported
  • Use the irregular payment pattern indicator in RTI for any employees who are not being paid regularly
  • Comply with all requests from HMRC to provide any employee data for past CJRS claims.

Is the Job Retention Bonus subject to tax?

Payments received under the JRS Bonus scheme must be recorded as income when calculating taxable profits for Income Tax and Corporation Tax purposes, unless you are an individual with employee(s) that are not employed as part of a business (i.e. nannies, domestic staff).

How to I claim online for the Job Retention Bonus?

Further guidance will be forthcoming in January 2021 as to how to access the online claim service.

Can my agent claim the Job Retention Bonus on our behalf?

If you use an agent who is authorised to conduct PAYE online for you then yes, they will be able to claim the JRS Bonus on your behalf.