During the Covid-19 pandemic, many businesses faced uncertainty regarding their future due to huge financial losses caused by government restrictions. The CARES Act launched in March 2020 provided a much-needed lifeline for employers in the form of Employee Retention Credit.
ERC meant that they could continue to pay their staff a normal wage, retaining their value, and claim a portion of these wages back later to make up for the loss of productivity and growth. In total, it’s estimated that this scheme has saved around 19 million jobs over the course of the last few years.
To get your free funding from the government, you will have to apply. This is where you would do your best to get an experienced agent to do this for you. I came across a company called ERC Benefits that provides a high quality service, where they carry out the service fast, efficiently and to ensure that you maximize the money you are entitled to.
Although the effects of the pandemic are largely over, Chief Financial Officers may still be experiencing issues that ERC could help with retrospectively.
Employee Retention Credit was a scheme launched in March 2020, ending in December 2021 which allowed employers to claim back a portion of each employee’s wage if they were still paying out during the restrictions without seeing any profit or financial benefit.
The ERC was open to small to medium businesses, with less than 500 employees in total. For businesses that had less than 100 employees, employers could claim back up to 100% of each employee’s wages throughout the 2-year period.
For businesses with over 100 but fewer than 500 employees, they were able to claim up to 50% of each employee’s wage back in year one, which increased to up to 70% of each employee’s wage per quarter in year two.
These amounts were capped at $26,000 per year per employee or $10,000 per quarter per employee.
Employee Retention Credit is still available to claim retrospectively, right up until December 2024. This assists businesses that didn’t have all of their information to file a return in year one and allows for CFOs to properly get to grips with their evidence in order to file. There are some things that CFOs will need to remember before making the claim.
If you’re confident that your business is able to provide the correct supporting evidence, applying for ERC through the IRS could be your savior, with many companies receiving $11,000 on average per employee to contribute to their growth and future stability.