Covid-19 Job Retention Bonus and SEISS Second Grants

Job Retention Bonus

Employers will be able to claim a one-off payment of £1,000 for every employee they have previously received a grant for under the Coronavirus Job Retention Scheme (CJRS) and who remains continuously employed through to the end of Ja‌nu‌ar‌y 2021.

To be eligible, the employee must have received earnings in November, December and January, and must have been paid an average of at least £520 per month, and a total of at least £1,560 across the three months.

As the employer, you or your clients will be able to claim the bonus after you have filed PAYE information for Ja‌nu‌ar‌y 2021, and the bonus will be paid from Fe‌br‌ua‌ry 2021. More detailed guidance, including how employers can claim the bonus online will be available by the end of September.

What you need to do

In order to claim the Job Retention Bonus, you must:

  • ensure all employee records are up to date
  • accurately report employees’ details and wages on the Full Payment Submission (FPS) through the Real Time Information (RTI) reporting system
  • make sure all of your CJRS claims have been accurately submitted and you have told us about any changes needed (for example if you’ve received too much or too little).

Reminder of changes to CJRS

From 1 Au‌gu‌st 2020 CJRS continues to provide grants for furloughed employees but no longer funds employers’ National Insurance (NI) and pensions contributions. Employers now have to make these payments from their own resources for all employees, whether furloughed or not. HMRC guidance has been updated to reflect these changes.

Further guidance and live webinars offering more support on changes to the scheme and how they impact you are available to book online – go to GOV‌.UK and search ‘help and support if your business is affected by coronavirus’.

Making sure your data is right

HMRC have stressed the importance of having the correct data they need to process any claim. Payment of your grant may be at risk or delayed if you submit a claim that is incomplete or incorrect. HMRC may be in touch to request employee data if it’s missing from your previous claims.

National Insurance numbers

You will need to provide a National Insurance number (NINO) for all employees as part of their CJRS claim. The only exception is in the very limited circumstances where an employee genuinely does not have a NINO, for example if they are under 16 years old.

If you are claiming for an employee whose NINO you don’t currently know, you can check their number by searching GOV.UK for ‘Check a National Insurance Number using basic PAYE Tool’.

HMRC state that they can no longer accept claims for fewer than 100 employees by phone where employers do not have all employee NINO’s unless the employees they are claiming for genuinely do not have these.

What to do if you’ve claimed too much in error?

If you  have claimed too much for a CJRS grant and have not repaid it, you must notify HMRC and repay the money by the latest of whichever date applies below:

  • 90 days after receiving the CJRS money you’re not entitled to
  • 90 days from when circumstances changed so that you were no longer entitled to keep the CJRS grant
  • 20 Oc‌to‌be‌r 2020 if you received CJRS money you’re not entitled to, or if your circumstances changed on or before 22 J‌ul‌y.

If you do not do this, you may have to pay a penalty. HMRC have said that they do understand mistakes happen, particularly in these challenging times, and will not seek out innocent errors and small mistakes for compliance action. However, they have also said that they will act against anyone who deliberately sets out to defraud the system or claims money they aren’t entitled to.

How to let HMRC know about claiming too much

If you have received more than you are entitled to, you can let HMRC know as part of your next online claim without needing to call them – the system will prompt you to add details on if you have received too much. For more information, search for ‘if you claim too much or not enough from the Coronavirus Job Retention Scheme’ on GOV‌.UK.

If you received too much and do not plan to submit further claims, or you have claimed less than you were entitled to, contact HMRC by searching ‘Contact HMRC’ on GOV‌.UK.

Potential penalties

If you do not repay HMRC the amount of coronavirus support payment overclaimed, HMRC will raise an assessment of tax equals the overclaim (FA 2020, Sch 16 para 8). This assessment can be appealed.

If you fail to notify HMRC of the overclaimed coronavirus support payment within the 90-day period HMRC will impose a penalty under the failure to notify rules. The penalty is calculated at 30% to 100% of the over-claimed amount, for an unprompted disclosure, but will be set at 50% to 100% of the over-claimed amount for a prompted disclosure.

Therefore, if you are investigated by HMRC and is found to have incorrectly claimed a CJRS or SEISS grant will be required to repay 150% to 200% of those funds.

Self Employed Income Support Scheme (SEISS) Second Grants and Repayments

The self-employed income support scheme (SEISS) has typically lagged behind the furlough grant scheme (CJRS), and HMRC have now confirmed that applications for the second SEISS grants will open on 17 August.

The HMRC guidance says it will work out if you are eligible for a SEISS grant and contact you to invite you to apply.

However, HMRC can’t check the three current-period conditions for the SEISS grant:

  • Whether the trade has been adversely affected by the coronavirus pandemic
  • If the individual traded in 2019/20 (if the tax return for that year hasn’t been submitted)
  • Whether the trader intends to continue to trade in 2020/21

If any of those conditions are not met the SEISS grant has been incorrectly claimed, you will need to tell HMRC as soon as possible and repay the overpaid amount. The disclosure must be made using the same government gateway user ID and password that was used to claim the original SEISS grant.

If you need any help with the Job Retention bonus, making sure that your data is accurate or if you’re concerned that you may have over-clamied at any point, please get in touch with us. We’d be happy to help.