Job Retention Bonus – Can you claim?

Coronavirus, Payroll,

The Job Retention Bonus is designed to encourage employers to retain employees that were furloughed. The details of the scheme have now been announced, which we’ve summarised below:

What is the Job Retention Bonus?

  • A one-off payment of £1,000 to the employer for each employee that was furloughed but kept in continuous employment until 31st January 2021.
  • The bonus does NOT have to be paid on to the employee.
  • You can claim the bonus between 15th February 2021 and 31st March 2021. After this date the scheme will close and you will not be able to benefit.
  • Any bonus amounts received are taxable.

Who can claim?

If you furloughed employees and made an eligible claim through the Job Retention Scheme (Furlough Scheme) you can claim.

You can also claim the bonus if you have claimed under the Job Support Scheme for the same employee.

Who can you claim for?

  • Employees you claimed for under the Job Retention Scheme (Furlough Scheme).
  • Employees you have continuously employed from the last Furlough Scheme claim, to the 31st January 2021.
  • Employees that are NOT on notice at 31st January 2021.
  • Employees who exceed the Minimum Income Threshold (see below).

What might delay your claim?

If HMRC are checking your claims through the Furlough Scheme, you can claim but your payment may be delayed.

Who can’t you claim for?

If you claimed incorrectly under the Furlough scheme for an employee, you cannot claim the Bonus for that employee.

You cannot claim for employees who transferred to your business under TUPE regulations, UNLESS you furloughed them, and successfully claimed under the Furlough scheme as their new employer.

What is the Minimum Income Threshold?

There is a minimum amount employees need to receive in salary for you to claim the Bonus.

To meet the minimum income threshold your employee must be paid 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
  • 6 January to 5 February 2021

The employee must receive 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 your employee’s pay in the relevant tax periods, such as being on statutory leave or unpaid leave

The minimum threshold levels will be checked against RTI submissions made as part of the payroll process before your claim is paid. You’ll need to have submitted your Full Payment Submission via RTI by the 5th February before you can make your claim.

There are some examples of the Minimum Income Threshold here.

As any claim made will be checked against RTI information before it is paid, please make sure that you allow for payment to take some time to be issued. As with any of the Coronavirus support schemes, please make sure you keep careful records of the amounts claimed for future reference.

How do you claim?

Details of the only claim service will be announced in January 2021. At that point, HMRC will issue guidance outlining the process required.

 

If you’re unsure about any of the above, do get in touch, or speak to your payroll agent. Whilst the process for making a claim hasn’t yet been announced, we would assume they will be able to submit the claim on your behalf after 15th February 2021.