Complete a Financial Impact Test if you’re a large employer claiming through the Job Support Scheme Open
Complete a Financial Impact Test (FIT) if you have 250 or more employees and are claiming through the Job Support Scheme Open.
If you employ 250 or more people and want to claim through the Job Support Scheme Open, you must complete a financial impact test before you claim to prove that you are you are experiencing reduced business activity due to coronavirus which has resulted in an impact on your turnover.
Who needs to complete the test
You only need to complete this test if you had 250 people or more on all your PAYE schemes as a single legal entity on 23 September 2020. You only need to do the test once before your first claim.
An individual is an employee for the purposes of this test if you treat them as an employee for Income Tax purposes, regardless of how you treat them for National Insurance purposes.
Example Company A Ltd operates 4 PAYE schemes, each with 100 employees. This means A Ltd is a large employer and needs to complete the test.
Companies B1 Ltd and B2 Ltd are in the same corporate group. Each has a PAYE scheme of 200 employees. This means neither B1 Ltd nor B2 Ltd are large employers for the purposes of the scheme.
If you’re a charity
If you’re a charity, you do not need to complete a financial impact test and can claim the scheme if you’re either:
- registered with a UK charity regulator
- exempt from registering with a UK charity regulator
Complete the financial impact test
If you’re VAT registered
The test is different depending on how often you submit your VAT Returns. If you’re part of a VAT group, you should use figures from the entire VAT group when completing the financial impact test.
If you file quarterly
If you file quarterly, compare the total sales figures (box 6) of your latest VAT Returns with a filing due date between:
- 31 August 2020 to 7 November 2020
- 31 August 2019 to 7 November 2019
If the figures from box 6 on your return due in 2020 are equal to or lower than the return due in 2019, you pass the financial impact test and can claim through the Job Support Scheme Open as long as you and your employees are eligible.
If you file monthly
If you file monthly, add the figures from box 6 of three consecutive VAT Returns, the latest of which is due to be filed and paid by 7 November 2020, and compare the figures with the same period in 2019.
If the figures from box 6 on your return due in 2020 are equal to or lower than the return due in 2019, you pass the financial impact test and can claim through the Job Support Scheme as long as you and your employees are eligible.
If you file differently
If you file differently or if you’ve changed how often you file in the past year, you will need to submit a VAT return by 7 November 2020. Add the figures from box 6 of your VAT Returns for three consecutive months ending with the following filing due dates:
- 31 August 2020 to 7 November 2020
- 31 August 2019 to 7 November 2019
If you do not have VAT returns for three consecutive months, you will need to apportion for three months.
Example You had a four-month period when your VAT return covered May, June, July and August 2019. It had a filing due date of 7 October 2019. You should divide the figure from box 6 of this VAT return by 4 and then multiply by 3.
You should then compare this to the return which covered June, July and August 2020, which had a filing due date of 7 October 2020.
Example You had a two-month period when your VAT return covered June and July 2019. It had a filing due date of 31 August 2019. The previous VAT return covered March, April and May 2019. You should add the figures from box 6 of these VAT returns, divide it by 5 and then multiply by 3.
You should then compare this to the return which covered May, June and July 2020, which had a filing due date of 31 August 2020.
If the figures from box 6 on your return due in 2020 are equal to or lower than the return due in 2019, you pass the financial impact test and can claim through the Job Support Scheme as long as you and your employees are eligible.
If you’re VAT registered but you cannot complete the financial impact test above because your VAT number was issued too recently, you’ll need to complete the same financial impact test as someone who is not VAT registered.
If you’re not VAT registered
You will need to work out your average monthly turnover from 1 May 2020 to 30 September 2020. You should compare it with your average monthly turnover using your most recent Company Tax or Income Tax self-assessment return. You must have submitted it on or before 23 September 2020. Take the turnover and divide it by the number of months in the accounting period to get the average monthly turnover.
Example Company C Ltd is not VAT registered. It works out its average monthly turnover between 1 May 2020 and 30 September 2020 as £20m.
C Ltd’s Corporation Tax return, for the period 1 April 2018 to 31 March 2019, was filed on 31 March 2020. Its turnover was £360m. It divides £360m by 12 to work out its average monthly turnover for that period as £30m.
If the figure from 1 May 2020 to 30 September 2020 is equal to or lower than the figure from the period before coronavirus, you pass the financial impact test and can claim through the Job Support Scheme as long as you and your employees are eligible.
This calculation is only available for large employers who are not VAT registered.
If you pass the financial impact test
If you pass the financial impact test then you can go on to check you and your employees are eligible for the scheme.
If you’ve already done that, you’ll need to work out how much you can claim.
If you do not pass the financial impact test you are not eligible to claim the Job Support Scheme and there is no right of appeal.