The CJRS, known as the Furlough scheme, will now continue until 31 March 2021.
As a result, the Job Support Scheme (JSS), which was due to start on 1 November 2020, has been postponed.
Also, the Job Retention Bonus, which was due to be paid in February 2021, has been scrapped.
Under the CJRS extension, furloughed employees will receive 80% of their current wages for their usual hours not worked, up to a maximum of £2,500 per month for November and December. Businesses will only have to cover employer’s National Insurance and employer’s minimum workplace pension contributions on those wages.
As before, employers can of course top up employee wages above the 80% threshold at their own expense.
The Government will review the policy in January to decide whether economic circumstances have improved enough to ask employers to contribute more.
Detailed guidance on the scheme, in particular full details on the claim calculations, is expected from HMRC in the next few days.
Here’s what we know so far …
- Employers do not need to have used the CJRS before.
- Employers across the UK can claim, whether their businesses have been forced to close or are open.
- Employers can claim for employees who were employed and on their PAYE payroll on 30 October 2020.
- Employers must have made at least one PAYE RTI submission to HMRC between 20 March 2020 and 30 October 2020, including a payment of wages for the furloughed employee.
- Employees on any type of employment contract can qualify.
- Flexi-furlough will be permitted alongside full furlough.
- Employees do have need to have been furloughed previously under CJRS.
- For employees that meet the eligibility criteria and were on an RTI submission on or before 19 March 2020, employers must use the same methodology for calculating reference pay and usual hours.
- For new employers claiming and new eligible employees hired between 20 March 2020 and 30 October 2020, alternative calculations of reference pay and usual hours will be required.
- Employees who were on the payroll on 23 September 2020, who were made redundant or stopped working for the employer after this date, can be re-employed and furloughed.
- As under CJRS previously, rules on employer-employee agreement and employees not working while on furlough will apply.
- The claims process will be very similar to that used so far under CJRS.
- Claims must be made within 14 days of the end of each month. For example, the November claim must be made by 14 December.
Keeping you compliant | Saving you tax | Helping you grow
Information in this publication is intended to provide only a general outline of the subjects covered. It should neither be regarded as comprehensive nor sufficient for making decisions, nor should it be used in place of professional advice. Whyatt Accountancy and the writer accept no responsibility for any loss arising from any action taken or not taken by anyone using this material.