Job Retention Bonus

Overview

The Job Retention Bonus is a one-off payment to employers of £1,000 for every employee who they previously claimed for under the scheme, and who remains continuously employed through to 31 January 2021. Eligible employees must earn at least £520 a month on average between the 1 November 2020 and 31 January 2021. Employers will be able to claim the Job Retention Bonus after they have filed PAYE for January and payments will be made to employers from February 2021.

The bonus will be taxable, so the business must include the whole amount as income when calculating its taxable profits for corporation tax (currently @ 19%).

Who can claim?

All employers are eligible for the scheme including recruitment agencies and umbrella companies.

An employer will be able to claim the Job Retention Bonus for any employees that were eligible for the Coronavirus Job Retention Scheme and they have claimed a grant for. Where a claim for an employee was incorrectly made, a Job Retention Bonus will not be payable.

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

Which employees are eligible?

Claims will only be accepted for employees that were eligible for the scheme. Where a claim for an employee was incorrectly made, a Job Retention Bonus will not be payable.

Employers will be able to claim for employees who:

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 the relevant employer 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

Employers can claim the Job Retention Bonus for all employees who meet the above criteria, including office holders, company directors and agency workers, including those employed by umbrella companies. The above criteria must be met regardless of the frequency of the employee’s pay periods, their hours worked and rate of pay.

How can the employer make a claim?

From February 2021 employers will be able to claim the Job Retention Bonus through GOV.UK. More detail about this process will be published in guidance by the end of September 2020.

Detailed government guidance: https://www.gov.uk/government/publications/job-retention-bonus/job-retention-bonus