Coronavirus Job Retention Bonus: Further Information Released

As part of his ‘Plan for Jobs’ Chancellor Rishi Sunak announced the Job Retention Bonus. This will see employers receive a £1,000 bonus for each employee that they bring back from furlough and continually employ from the end of the CJRS on 31^st October to 31^st January 2021.

Today (31^st July), the government released further information relating to the scheme and committed to providing full guidance by September 2020. You can read the full policy paper here.

Can limited company directors’ benefit from the bonus?

The policy paper confirms that an employer will be able to claim the Job Retention Bonus for any employees eligible for the Coronavirus Job Retention Scheme that they have claimed a grant for. The paper goes on to state that employers can claim the Job Retention Bonus for all employees who meet the below criteria, including company directors.

At this point it appears that directors of Personal Service Companies who placed themselves on furlough due to the economic impacts of Coronavirus will be able to make a claim for the £1,000 bonus provided they meet the following eligibility criteria.

You will be able to make a claim for yourself and any other employees of your business that:

• were furloughed and had a Coronavirus Job Retention Scheme claim submitted for them that meets all relevant eligibility criteria for the scheme
• have been continuously employed by your business since they returned from furlough until 31 January 2021
• have been paid an average of at least £520 a month between 1 November 2020 and 31 January 2021 and been paid each month with RTI submissions made to HMRC
• you 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

It is important to note that this is a taxable grant. Should you be eligible for the Job Retention Bonus the £1,000 will be included as income and subject to corporation tax.

What should I do now?

We do not yet have the guidance that will give us certainty as to how the scheme will operate, this is due in September 2020 and we will update our clients as soon as we have this. You are not able to make a claim for a Job Retention Bonus until February 2021 at the earliest, so for now there is no action needed.