Last reviewed 5 October 2020

When the Chancellor announced his package of measures in July, he included a Job Retention Bonus. This is a £1000 one-off taxable payment to employers for each eligible employee that they furlough and keep continuously employed until 31 January 2021.

Now HM Revenue & Customs (HMRC) has issued guidance on the scheme which clarifies that employers will be able to claim the bonus between 15 February and 31 March 2021 and that they do not have to pay this money to the employee.

Available at GOV.UK, this guide includes details of eligible employees, including those have been transferred under TUPE or due to a change in ownership.

It also confirms that it is possible to claim the Job Retention Bonus for individuals who are not employees, such as office holders or agency workers, as long as the employer claimed a grant for those people under the Coronavirus Job Retention Scheme and the other Job Retention Bonus eligibility criteria are met.

Among other details, the guide specifies that, to meet the minimum income threshold, an employer must pay the employee a total of at least £1560 (gross) throughout the tax months: 6 November to 5 December 2020; 6 December 2020 to 5 January 2021; and 6 January to 5 February 2021.

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).

HMRC has also published Example of employer deciding which employees will meet the minimum income threshold for the Job Retention Bonus.

These examples demonstrate how the minimum income threshold is used for Job Retention Bonus claims.

Comment by Peninsula Associate Director of Advisory Kate Palmer

With the announcement of the new Job Support Scheme last month, employers could have been forgiven for almost forgetting about the Job Retention Bonus.

This long-awaited update from the Government sends a clear message that the Bonus remains an option for employers despite the Job Support Scheme, and one they can seek to make use of as they consider their options when the Job Retention Scheme ends.

The new guidance clarifies several areas we were waiting for further information on, including steps that need to be taken now to successfully claim for the Bonus and, specifically, when these claims can be submitted.

Employers who are considering making use of the Bonus will therefore want to familiarise themselves with this guidance in order to take all necessary steps to meet the eligibility requirements outlined within it.