Changes to Coronavirus Job Retention Scheme and Self-Employed

1.  Coronavirus Job Retention Scheme (CJRS) Extension

Overview:

·         CJRS will remain open until 31 March 2021.

·         Employees will receive 80% of their usual salary for hours not worked, up to a maximum of £2,500 per months, until January 2021. 

·          The Government will review the policy in January.

Eligibility criteria for employers:

·         Employers do not need to have used CJRS previously.

·         Open to employers across the UK, regardless of whether their business is open or closed.

·         It is expected that publicly funded organisations will not use the scheme, however, partially publicly funded organisations may be eligible where their private revenues have been disrupted.

Eligibility criteria for employees:

·         Employers can furlough employees who were employed and on their PAYE payroll on 30 October 2020. The employer must have made a PAYE Real Time Information submission to HMRC between 20 March 2020 and 30 October 2020.

·         Employees do not need to have been furloughed under the CJRS previously.

·         For an employee who meets the criteria of the extended scheme but was not previously eligible for CJRS, the alternative calculations of reference pay and usual hours must be used. For all other employees, employers must use the CJRS calculations for calculating reference pay and usual hours.  

·         Employers will be asked to contribute the same as they did in August 2020 (National Insurance and employer pension contributions for hours not worked by their employee). 

·         Employees can be furloughed when they are unable to work because they:

o   Are shielding in line with public health guidance (or need to stay at home with someone who is shielding)

o   Have caring responsibilities resulting from coronavirus, including employees that need to look after children

·         Employees that were employed and on the payroll on 23 September 2020 who were made redundant or stopped working for their employer can be re-employed and claimed for. 

·         An employee who was on a fixed term contract, on the payroll on 23 September, and which expired after 23 September 2020 can be re-employed and claimed for if they meet the other eligibility criteria.

Other conditions:

·         Employers can fully or flexibly furlough employees.

·         Flexible furlough agreements can last any amount of time and employees can enter into a flexible furlough agreement more than once. 

Claiming under the CJRS extension:

·         Employers must report and claim for a minimum period of 7 consecutive calendar days.

·         Employers will need to report actual hours worked and the usual hours an employee would be expected to work in a claim period. 

·         For hours worked, employees will be paid by their employer subject to their employment contract and employers will be responsible for paying the tax and NIC’s due on those amounts.

·         The claim period must start and end within the same calendar month.

·         An employer can make a claim in anticipation of an imminent payroll run, at the point they run their payroll or after they have run their payroll. 

·         There will be a short period when the legal terms of the scheme and system are updated. Businesses will need to claim in arrears for this period. 

·         Employers will be able to claim from 8am on Wednesday 11 November.

·         Claims can be made in arrears for the period 1 November 2020 to 11 November 202, from the week commencing 9 November 2020. 

·         Claims relating to November 2020 must be made by 14 December 2020. Claims relating to each subsequent month should be submitted by day 14 of the following month. 

·         The Job Retention Bonus will not be paid in February 2021 and a retention incentive will be deployed at the appropriate time.

For further information see:

https://www.nibusinessinfo.co.uk/content/coronavirus-extension-coronavirus-job-retention-scheme

Note: Full guidance will be published on Tuesday 10 November by the government.

2.  Self-Employment Income Support Scheme Extension (SEISS)

Overview:

·         The SEISS consists of two grants, each available for three-month periods covering November 2020 to January 2021 and February 2021 to April 2021. 

·         Grants will be paid in two lump sums.

·         For the period 1 November until 31 January, the grant will be calculated at 80% of three months average monthly trading profits, paid out in a single instalment, and is capped at £7,500 in total.

·         The government will set out further details in due course on the grant covering February 2021 to April 2021. 

·         The grants are taxable income and subject to National Insurance contributions.

Eligibility:

·         Self-employed individuals, including members of partnerships, must:

o   Have been previously eligible for the SEISS first and second grant (although they do not have to have claimed them)

o   Declare that they intend to continue to trade and either are currently actively trading but are impacted by reduced demand due to coronavirus, or were previously trading but are temporarily unable to do so due to coronavirus.

Claiming the grant:

·         The online service for the next grant will be available from 30 November 2020.

·         HMRC will provide full details about claiming and applications in due course.

For further information see:

https://www.gov.uk/government/publications/self-employment-income-support-scheme-grant-extension/self-employment-income-support-scheme-grant-extension