June 2, 2020
by  Pradeepan Velayuthan

Coronavirus Job Retention Scheme & Self-Employment Income Support Scheme - Extension

On 29 May 2020, the government extended the Coronavirus Job Retention Scheme (CJRS). 

Furloughed Employees can now work part-time

Employees that have been furloughed due to COVID-19 will be able to have a flexible employment from the 1 July 2020. Employers will have the flexibility to allow their furloughed employees to work part time. Despite this change, the government will continue paying 80% of salaries of their normal hours that they have not worked until the end of August. 

The employer has control on the employment hours and the employer will be responsible for paying the full wage to their employee. There are no set requirements of the number of hours that an employee must work, this will vary depending on your business requirement. 

What must be done?

This new working arrangement between an employee and employer must be confirmed in writing. This agreement with an employee must cover at least one week and reported and claimed when the employer claims for the CJRS grant. You can make claims every fortnight or month, but you will be required to submit both the standard hours of the employee and the actual hours worked.

 If you have an employee who is unable to work or you do not have work to provide them, the employee can remain as furloughed and you can claim the grant under the current conditions.

Employer Contributions

There are a few changes that will change over the upcoming months regarding employer contributions.

June/July:

  • The government will pay 80% of wages up to a maximum of £2,500
  • Employer National Insurance and Pension Contributions will be covered for the hours not worked by the employee.
  • Employers will have to pay employees for the hours they have worked.

August:

  • The government will pay 80% of wages up to a maximum of £2,500
  • Employers will have to pay for Employers National Insurance and Pensions Contributions

September:

  • The government will pay 70% of wages, up to a maximum of £2,187.50 of the hours the employee does not work
  • Employers will be required to pay the 10% of wages to make up 80% of the total up to a maximum of £2,500
  • Employers pay National Insurance and Pension Contributions

October:

  • The government will pay 60% of wages, up to a maximum of £1,875 of the hours the employee does not work
  • Employers will be required to pay the 20% of wages to make up 80% of the total up to a maximum of £2,500
  • Employers pay National Insurance and Pension Contributions

If you are a smaller employer, some or most of your national insurance costs will be covered by the Employment Allowance.

CJRS – New Furloughed Employees

The Coronavirus Job Retention Scheme will close to new individuals who wish to be furloughed from 30 June 2020.

  • From 30 June, you will only be able to furlough employees who have been furloughed for a full three weeks prior to 30 June
  • The deadline for newly furloughed employees is 10 June to fit the three-week criteria

How to Claim?

Go to GOV.UK and search for Coronavirus Job Retention Scheme. Everything you need to know about this scheme is on GOV.UK

Self-Employment Income Support Scheme (SEISS)

  • The Self-Employment Income Support (SEISS) has also been extended similarly to CJRS.
  • Self-employed individuals who are eligible will be able to claim a SEISS grant in August.
  • The scheme will be targeting towards individuals who have been affected severely by COVID-19 and the criteria will be the identical as the initial grant.
  • To be eligible for the second grant, you do not have to claim the first claim.
  • The taxable grant will be 70% of your average monthly profits for three months. This will be a maximum of £6,570 and paid in one instalment.
  • On 13 May 2020, the first SEISS was introduced and the deadline to claim this falls on 13 July 2020.

How to Claim?

The eligible self-employed individual must make this claim themselves. HMRC will then calculate the grant you will receive

More information regarding the second grant will be available on 12 June but in the meanwhile, GOV.UK has the most recent and regular information regarding this scheme.

https://www.gov.uk/government/organisations/hm-revenue-customs

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