How the scheme works

The Kickstart Scheme is a £2 billion fund to create thousands of 6-month work placements across England, Scotland and Wales. It's aimed at 16 to 24 year olds who are on Universal Credit and deemed to be at risk of long term unemployment. 

Eligible 16 to 24 year olds are matched with placements and they then contact the relevant employer. The employer can choose to employ the person or not. The funding will be provided once they're employed and being paid via PAYE.

The funding for each job will cover 100% of the relevant National Minimum Wage for 25 hours per week. It also covers the employer's national insurance and automatic enrolment contributions. There's also an additional £3,000 per job placement available to cover setup costs, support and training. Once the placement is created, it can be taken up by a second person once the first person has completed their 6 month term.

You can find out more about the scheme and how to apply in our Kickstart Scheme guide.

Create new nominal codes to record grants

We recommend you create the following new nominal codes to record when you apply to the scheme and when grants are received, unless otherwise advised by your accountant. This will help you when reconciling any grant income received.

1. On the navigation bar click Nominal codes then click New/edit.
2. Complete the Nominal Record window as follows:

   N/C	Enter the nominal code number you want to create, for example, 1150.
   Name	Enter the name of the account, for example, Kickstart Scheme Debtor.

3. Click Save then click Close.
4. Repeat this process to create the second nominal code.

TIP: If not already included, you must add your new nominal codes to your existing chart of accounts. If preferred, you can show coronavirus grants as a separate category on your profit and loss. Find out more >

Record grant claimed

NOTE: There's no change to how you record your payroll postings in Sage 50 Accounts. You should continue to run your Nominal Link or post salary journals as normal.

Once your application is successful and you receive confirmation of the grant amount you are due to receive, you should record this as a journal entry on the profit and loss under Other Sales.

For the purposes of this section we'll use the following example:

• The company receives confirmation they will receive a grant of £2,500.
• No grant has yet been received.
• In this example, we're using the non-vatable tax code, T9.*

1. On the navigation bar click Nominal codes then click Journal entry.
2. In Reference, enter a reference, then in Posting Date enter the date.
3. Enter the following information to record the accrued income:
   

   N/C	Name	Details	T/C	Debit	Credit
   1150	Kickstart Scheme Debtor	Kickstart Scheme claim	T9	2500.00
   4950	Kickstart Scheme Income	Kickstart Scheme claim	T9		2500.00

4. Click Save then click Close.

Record grants received

As you receive each grant from the scheme, you should record a bank receipt to the Kickstart Scheme Debtor nominal code. This increases your bank account balance and reduces the Kickstart Scheme Debtor balance.

For the purposes of this section we'll use the following example:

• The company receives confirmation they will receive a grant of £2,500.
• A grant of £500 for initial setup costs has now been received.
• In this example, we're using the non-vatable tax code, T9.*

1. Click Bank accounts, click Receipts then click Bank receipt.
2. Complete the Bank receipts window as follows:
   

   Bank	Date	N/C	Details	Net	T/C	Tax
   1200	Date of receipt	1150	Kickstart Scheme grant received	500.00	T9	0.00

3. Click Save then click Close.

NOTE: * For VAT registered businesses, income is vatable if it's within the normal scope of a business or linked to a supply.  Coronavirus related grants are one-off events unrelated to any supply of goods or services. Whilst it's unlikely that any grant income will attract a VAT liability, you should seek specific advice from your accountant to understand if any grant received should be treated as vatable or non-vatable income.  You can find further details on what income is vatable in the HMRC manual. Grant income is likely to be considered income for income or corporation tax purposes.

Additional questions you may have

To help support you, we've put together a handy Kickstart Scheme guide.