Job Retention Bonus
The job retention bonus is a grant of £1,000 given to you for every eligible employee that was furloughed but remained in continuous employment with you until 31 January 2021.
The Job Retention Bonus is an extension of the Job Retention Scheme which expired on 30 November 2020. Only employees that were eligible for the Job Retention Scheme are entitled to the retention bonus.
You cannot claim a bonus for any employee not paid via the Job Retention Scheme because you have repaid all the grant amounts you claimed for them. This applies regardless of the reason why you repaid the grant amounts.
Which employees can I claim for?
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Claim for employees who were eligible for the Job Retention Scheme (expired 30 November 2020).
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Claim for employees that you kept in continuous employment from the end of the Job Retention Scheme claim, until 31 January 2021.
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Claim for employees who would not serving any type of notice period on 31 January 2021.
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Claim where you paid enough in relevant tax each month to reach the minimum threshold for this scheme. The minimum threshold will be covered below.
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Claim for TUPED in employees if the TUPE and PAYE rules are applied and where the employees were associated with the transfer of a business from the liquidator of a company in compulsory liquidation where TUPE would have applied if the company was not in compulsory liquidation.
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Claim for employees who have been transferred to you if you furloughed them and were successful in claiming for them under the Job Retention Scheme. It’s now too late to claim for the Job Retention Bonus for any employees transferred after 31 October, as the Job Retention Scheme closed then.
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You can claim the Job Retention Bonus for individuals who are not employees, such as office holders or agency workers, as long as you claimed a grant for them under the Coronavirus Job Retention Scheme and the other Job Retention Bonus eligibility criteria are met.
Meeting the minimum income threshold is a pre-cursor to be eligible for the Job Retention Bonus Scheme. This means:
- Paying your employees a minimum gross salary of £1,560 through the tax months of 6 November to 5 December 2020, 6 December 2020 to 5 January 2021 and 6 January 2021 to 5 February 2021.
- You must pay your employee at least one payment of taxable earnings (of any amount) in each of the relevant tax months.
- You must pay your employee 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 you pay your employees and any circumstances that may have reduced your employee’s pay in the relevant tax periods, such as being on statutory leave or unpaid leave
Only payments recorded as taxable pay will count towards the minimum income threshold. Taxable pay is reported to HMRC as a single figure through Full Payment Submissions via Real Time Information (RTI).
If you make redundancies, you must comply with the normal rules for redundancy, which include using fair redundancy criteria. These rules apply even if this means that fewer of your employees are eligible for the Job Retention Bonus.
From 15 February 2021. The scheme closes on on 31 March 2021.
Before you can claim the bonus, you will to need to have reported all payments made to your employee between 6 November 2020 and 5 February 2021 to HMRC through Full Payment Submissions via Real Time Information (RTI).
There are some steps you need to take now to make sure you’re ready to claim.
You must:
- Still be enrolled for PAYE online.
- Comply with your PAYE obligations to file PAYE accurately and on time under Real Time Information (RTI) reporting for all employees between 6 April 2020 and 5 February 2021.
- Keep your payroll up to date and make sure you report the leaving date for any employees that stop working for you before the end of the pay period that they leave in.
- Use the irregular payment pattern indicator in Real Time Information (RTI) for any employees not being paid regularly.
- Comply with all requests from HMRC to provide any employee data for past Coronavirus Job Retention Scheme claims.
You must include payments you receive under the scheme as income when you calculate your taxable profits for Income Tax and Corporation Tax purposes.
Businesses can deduct employment costs as normal when calculating taxable profits for Income Tax and Corporation Tax purposes.
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.