Chancellor Rishi Sunak has announced a Coronavirus Job Retention Scheme to protect small business jobs.
Any PAYE-qualifying small business employee will qualify for the Coronavirus Job Retention Scheme, which will cover 80 per cent of a regular salary up to £2,500 a month, just above the median income.
Small business owners must apply to HMRC and the Coronavirus Job Retention Scheme will be backdated to March 1 to cover a three-month period.
Sunak said there was no limit on how much this job-retention scheme might cost, which will be financed through the national debt.
The government expects the first job-retention grants to be payed before the end of April.
Under the Coronavirus Job Retention Scheme, all UK employers will be able to access support to continue paying part of their employees’ salary for those employees that would otherwise have been laid off during this crisis.
All UK businesses are eligible.
How to access the scheme
You will need to:
- designate affected employees as ‘furloughed workers,’ and notify your employees of this change – changing the status of employees remains subject to existing employment law and, depending on the employment contract, may be subject to negotiation
- submit information to HMRC about the employees that have been furloughed and their earnings through a new online portal (HMRC will set out further details on the information required)
HMRC will reimburse 80% of furloughed workers wage costs, up to a cap of £2,500 per month. HMRC are working urgently to set up a system for reimbursement. Existing systems are not set up to facilitate payments to employers.
Further information on this will be released as it becomes available.