Yes. The amounts paid to the employer under the co-funding scheme will be treated as a business receipt and will be taxable. The full wages paid will be an allowable expense.
Employers should continue to operate the ETI scheme on all payment made to their employees, including on the monies paid under the co-funding scheme, deducting tax and social insurance and remitting this as normal. For example if an employee is paid the equivalent of Guernsey’s minimum wage, the employer will need to record the payment of £298 gross to the employee, deduct tax and social insurance as normal, and then actually pay the individual the net amount.
Any amounts paid to self-employed individuals will be treated as a business receipt and will be taxable.