Lead Forencsices

Posted by James Pearson on 09 Apr 2020

Directors and the Coronavirus Job Retention Scheme

The Coronavirus Job Retention Scheme allows employers to claim a grant to cover wages of furloughed employees, including directors, but dividend payments will not be covered.

The Coronavirus Job Retention Scheme is one of the key measures to support employers during the COVID-19 pandemic and allows employers to claim for 80% of furloughed employees’ usual monthly wage costs up to £2,500 a month.

It has not been clear how this scheme will work for directors who are both employees and office holders, leading to questions as to whether directors can be furloughed, given that a company always needs to have a director.

It now seems that the scheme can apply to directors but in many cases, this may be of limited use, given that grants will be based on historical salary payments and not dividends, as favoured by shareholder directors.

Full details of how the scheme works, the conditions that need to be met and the amount you can claim can be found here.

Calculate 80% of your employee’s wages and claim online via HMRC here.

If you would like any advice regarding how the Coronavirus Job Retention Scheme affects directors or would simply like to discuss other ways in which we could help you or your business, please contact us on 01962 856 990 or customerservice@taxinnovations.com

 

See also…

The Coronavirus Job Retention Scheme

UK Tax Residence – Impact Of Coronavirus

COVID-19 Summary of Available Assistance

Inheritance Tax Planning