Large employers using the Job Support Scheme Open (JSS Open), defined as a legal entity with 250 or more employees across their payrolls on 23 September 2020, have specific eligibility criteria and guidance that should be adhered to when submitting a claim.
Financial Impact Test
This test is to evidence that their impact has been negatively impacted by the coronavirus pandemic.
If the employer’s turnover has remained equal or has decreased compared to the previous year, then they will qualify. This test only needs to be taken once before the employer’s first claim for the Job Support Scheme.
- Large employers who are VAT registered and submit quarterly VAT returns, should compare the total sales figure on their VAT return, which is due to be filed and paid between 31 August 2020 and 7 November 2020, with the total sales figure from the same quarter in 2019;
- This is the figure recorded in box 6 of their VAT return, which captures the total value of sales and all other outputs excluding any VAT;
- Large employers who file less frequently should compare the three consecutive months which are due to be filed and paid by 7 November 2020 with the same period in 2019; but
- They will need to have submitted a VAT return between 31 August 2020 and 7 November 2020 to be eligible.
Any charity with 250 or more employees that is registered with a UK charity regulator or are exempt from such registration will not be required to carry out the test and are eligible for this scheme.
Further guidance for large employers who are not VAT registered will be available by the end of October.
Example of doing a financial impact test
Employers who submit quarterly VAT returns:
- Take the box 6 turnover figure from the return with a filing due date between 31 August 2020 and 7 November 2020;
- Take the box 6 turnover figure from the equivalent return in the 2019 year to that used in step 1; and
- If the step 1 figure is equal to or lower than the step 2 figure, then employers are eligible to claim the Job Support Scheme, provided they meet the other employer eligibility criteria, for eligible employees.
Capital Distributions
The government expects that large employers (250 or more employees) and their corporate groups using the scheme will not make capital distributions whilst claiming the Job Support Scheme grant. This includes.
- Dividend;
- Charge;
- Free or other distribution; and
- Any equivalent payment that a partnership may make to its partners.
The government does not plan to make this expectation a contractual or legal condition of the scheme but encourages business to reflect on their responsibilities and that taxpayers should be able to rely on public money only being claimed where it is clearly needed.