The government announced the Coronavirus Job Retention Scheme to help businesses to continue paying employees that otherwise may have been laid off. Under this scheme, businesses can access grants of up to 80% of their employees’ wages up to a total of £2,500 per month per furloughed employee.
To access this scheme, businesses need to designate their workers as ‘furloughed employees’. A furloughed employee is an employee that remains on the payroll but is not working due to the coronavirus outbreak. From 1st July the government introduced flexible furloughing, which allows part time furlough depending upon your workloads. This could see you or your employees return to work a few days a week and continue to be furloughed for the remainder of the week, this could be useful for contractors who may be offered a tapered return to the office.
For the time furloughed, your employees cannot do any work that makes money or provides services to the business. The government has confirmed that company directors can be furloughed and continue to complete their statutory filing obligations.
Following the announcement of a second national lockdown for England the scheme was extended to 31st March 2021. From 1st November 2020 to 31st January 2021 the CJRS will operate in largely the same way as it did in August 2020. Crucially, this extension to the CJRS is available to all UK businesses that have been adversely impacted by the coronavirus pandemic, neither the business, nor the individual need to have accessed the scheme previously.
For claims made from December 2020 onwards, HMRC will publish the company name plus company registration number of all businesses that have made a claim under the CJRS. If you opt to make a claim under the scheme you should be aware that this will be a matter of public record.
To make a claim under the extended CJRS, the employee you wish to make a claim for must have been on your company’s PAYE payroll on 30th October 2020. You must have made at least one PAYE Real Time Information (RTI) submission to HMRC for the person you wish to make a claim for between the 20th March 2020 and 30th October 2020.
Until 31st January 2021 the grant available will remain at 80% of the wage costs of the furloughed employee or director up to a maximum of £2,500 per month. The business will need to bear the cost of any Employers NI, apprentice levy and auto-enrolment pension costs if applicable. Holiday pay will accrue as usual for the period the employee is on furlough.
It is important to note that this scheme will only cover salary. If you are a company director and receive dividends this will not be included in the calculation of the grant.
How do I claim this?
The portal to facilitate claims for the extended period from 1st November 2020 is now open.
As previously, your accountant will be able to make the claims on your behalf, provided they are authorised as your agent. If you wish to make the claim yourself, you will need a PAYE online account.
You will also need to calculate the amount of the claim yourself and you should keep a record of how this was calculated. HMRC has been clear that they will be investigating claims made under the CJRS and it is essential you keep all records that relate to the claim for 5 years.
All claims for furlough periods from 1st July 2020 to 31st October 2020 must be submitted no later than 30th November 2020.
Claims from 1st November 2020 must be submitted by 11.59pm 14 calendar days after the month you’re claiming for. If this time falls on the weekend, then claims should be submitted on the next working day.
Claim for furlough days in
Claim must be submitted by
||14 December 2020
||14 January 2021
||15 February 2021
||15 March 2021
||14 April 2021
||14 May 2021
You can find the full guidance on the extended CJRS here.