Tax Corner: Jobs furlough support scheme is extended until end of next March
QUESTION: I am self employed with a number of employees and over the Halloween weekend I understand that the Chancellor has made yet more changes to the Job Support Scheme which was due to commence in November?
ANSWER: With the Job Support Scheme (JSS) announcements having been issued just one day before the extension of the Coronavirus Job Retention Scheme (CJRS), many business owners and employees are confused over the current state of play.
Although unexpected, the CJRS extension is a welcome reaction to the new lock down restrictions which were introduced at the Halloween weekend by the Prime Minister.
The CJRS has now been extended until next March, and the Chancellor has announced that the furlough payments will now be extended at the same previous level of support equivalent to 80 per cent of wages for those people unable to work or unable to work their full hours as a result of the extended Coronavirus restrictions across the UK.
The CJRS will pay businesses for wage costs and 80 per cent can be claimed in respect of each furloughed employee up to a ceiling of £2,500. As per the existing CJRS scheme that ended on October 31, employers must still maintain pension liabilities and PAYE and flexible furlough will be permitted.
To be eligible for the scheme, employers seeking to place employees on furlough must have had those employees on a PAYE real time information return by midnight on Friday October 30.
Employees can be on any type of contact and employers can claim the grant for the hours their employees are not working calculated by reference to their usual working hours in a claim period and therefore the calculations will follow the similar methodology currently used under the former CJRS.
You will need to report the hours worked and the usual hours that any employee you place on the CJRS would be expected to work within a claim period and you will need to report and claim for a minimum period of 7 consecutive calendar days.
For those hours worked, employees will be paid subject to their employment contract and you will be responsible, as their employer, for paying the tax and national insurance due on the amounts.
Turning to your own situation, as a self employed business person, the Chancellor also increased support for self employed.
Phase 2 of the Self Employed Income Support Scheme (SEISS) closed on October 19 and a third phase runs from November 1 until April 30 in two stages from November to January and from February until April.
The next income support grant, which covers the period November to January, will now increase to 80 per cent of average profits up to £7,500.
Paddy Harty (email@example.com) is a senior tax director at PKF-FPM (www.pkffpm. com). The advice in this column is specific to the facts surrounding the question posed. Neither The Irish News nor contributors accept any liability for any direct or indirect loss arising from any reliance placed on replies.