The Chancellor Rishi Sunak extended the Job Retention Scheme (CJRS) in November, which will have a major effect on both employers and payroll departments. In this article we look at the initial guidance and note that there will be further review for guidance from February 2021 onwards.
CJRS will now remain open until 31 March 2021. Because of these changes, both the Job Support Scheme and the Job Retention Bonus are postponed, and further information will be provided at a later date if applicable. The scheme is also UK wide.
For claim periods running to January 2021, employees will receive 80% of their usual salary for hours not worked, up to a maximum of £2,500 per month. The £2,500 cap is proportional to the hours not worked. This is in line with the rules that were in place for August this year. As such the employer will still be liable for their costs such as National Insurance and Pension contributions. The government will then review the policy in January to decide whether economic circumstances are improving enough to ask employers to contribute more.
HMRC have confirmed that claims can be made by employers across the UK and do not need to have used the CJRS previously and can be opened or closed unlike the previously announced Job Support Scheme (JSS). Publicly funded organisations will not use the scheme, but partially publicly funded organisations may be eligible where their private revenues have been disrupted. All other previous CJRS eligibility requirements also apply to these employers.
Employers can claim for employees who were employed and on their PAYE payroll on or by the 30th of October 2020. The employer must have also made a PAYE Real Time Information (RTI) submission including the employee to HMRC between the 20th of March 2020 and the 30th of October 2020, notifying a payment of earnings for that employee.
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Here at JLP, we are fully prepared for this extension when it comes to payroll. Contact us for help and advice.