Coronavirus Job Retention Scheme

UPDATED 06 January 2021

The Government has announced that the Coronavirus Job Retention Scheme (CJRS) - also known as the Furlough scheme, has been extended until 30 April 2021.

This is an overview of the Coronavirus Job Retention Scheme and provides.

  • Key information about the scheme
  • How much you can claim
  • What to do next

Before you start

Check information from Government

Whilst every effort has been made to keep this topic up to date, we advice you to check the official government website to keep up to date with the latest changes to the financial support relating to Coronavirus available from the Government and for useful tools.

Extension of the Coronavirus Job Retention Scheme

Job Retention Scheme Calculator

About the job retention scheme

This scheme has been set up to support employers whose businesses have been affected by coronavirus and help them continue to pay the wages of staff who would otherwise have been let go.

All UK businesses, including charities, are eligible for the Coronavirus Job Retention Scheme (CJRS). There isn’t a cap on the number of workers who can be selected for the scheme.

Key information from November 2020

  • As an employer, you do not have to have claimed before.
  • Employees do not need to have been furloughed under CJRS previously.
  • The government will pay 80% of the wages of furloughed employees, up to £2,500 per month.
  • You can top this up if you want to, but you can't claim for this.
  • As an employer, you pay all the employer's National Insurance and employer pension contributions.
  • Claims can be made by employers across the UK that meet the eligibility criteria.
  • For the latest detailed guidance from HMRC, see Extension of the Coronavirus Job Retention Scheme

Changes to employer contributions

Between 1 August 2020 until the end of April 2021, businesses may be required to contribute to the scheme alongside the government.

Crucially, furloughed staff will still receive 80% of their salaries covering the period when they’re unable to work.

The scheme has been running in June 2020, with different rules around what you claim and which employees are eligible. Here's what it looks like for all the different periods:

June: The government paid 80% of the reference salary, capped at £2,500. It also paid employer National Insurance and pension contributions. Employers didn't have to pay anything.

July: The government paid 80% of the reference salary, capped at £2,500. It also paid employer National Insurance and pension contributions. Employers didn’t have to pay anything.

August: The government paid 80% of the reference salary, capped at £2,500. Employers have to pay for employer National Insurance and pension contributions.

September: The government paid 70% of the reference salary, capped at £2,187.50. Employers paid for employer National Insurance and pension contributions, and 10% of wages to make up the minimum employee salary of 80% of the reference salary, capped at £2,500.

October: The government paid 60% of the reference salary, capped at £1875. Employers paid for employer National Insurance and pension contributions, and 20% of wages to make up the minimum employee salary of 80% of the reference salary, capped at £2,500..

From November: The government pays 80% of the reference salary, capped at £2,500. Employers have to pay for employer National Insurance and pension contributions.

What to do next

  1. Check the eligibility criteria for the scheme against your individual circumstances.

  2. Place your employees on furlough and notify them of this change.
  3. Pay your employees.
    1. Set up a new payment type in Payroll.
    2. Use the new payment type when processing your employees pay.
  4. Make a claim using the HMRC’s online portal and reimbursement system.

Disclaimer

This article provides general rather than specific guidance to assist all of our customers. We always do our best to make sure that the information is correct but as it's general guidance, no guarantees can be made concerning its suitability for your particular needs. The information is valid at the time of publishing and is provided without any warranty of any kind, express or implied. You should take professional advice if you require specific guidance on your individual circumstances, for example to ensure that the results obtained from using our software comply with statutory or regulatory requirements. For Employers, PAYE, NIC and general tax enquiries you should call the HMRC helpline on 0300 200 3200 or visit their website at www.gov.uk In no event will we be liable to you for any direct, indirect, consequential or incidental loss or damage arising out of or in connection with your use of the information provided.