As we enter the final month of the coronavirus job retention scheme (CJRS), we thought it would be a good idea for a quick recap of the rules and impending deadlines.
The scheme was introduced in March as one of the key measures to support employers and employees during the COVID-19 pandemic. It was originally due to end in June, but an extension was announced with effect from 1 July, which also introduced the possibility to flexibly furlough employees.
Employers are only able to claim for employees from 1 July, that have also completed a minimum three-week furlough period prior to 30 June 2020.
Claims under the CJRS can still be made for 1 July to 31 October but HMRC has confirmed that the final deadline for submission is Monday 30 November 2020.
After this date it will not be possible to submit or amend any claims, although there will be a facility to report where overclaims have been made.
What can be claimed
The claim amounts have been reducing each month and are, broadly, as follows:
- 1 July to 31 July – up to 80% of wages for furloughed hours capped at £2,500 per employee per month, plus employer’s national insurance (NI) and pension contributions.
- 1 August to 31 August – 80% of wages for furloughed hours capped at £2,500 per employee but the employer will need to meet the NI and pension contributions.
- 1 September to 30 September – 70% of wages for furloughed hours capped at £2,187.50.
- 1 October to 31 October – 60% of wages for furloughed hours capped at £1,875.
For further details on the scheme and how to calculate the grant please read our article here.
What happens if you have made an error?
If you realise that you have overclaimed there are two options to rectify. Firstly, if you still have another claim to make, you can reduce this by the amount overclaimed. If you have no further claims to make, then you can apply online to HMRC for a payment reference number to make a repayment.
To avoid penalties, the amount needs to be repaid by the later of;
- 90 days from the date you received the grant; or
- 20 October 2020.
If you have underclaimed then you will need to contact HMRC on 0800 024 1222 by 30 November to make an amendment. No underclaims will be accepted after this date.
If you have a PAYE agent, they should be able to assist you with making an amendment.
HMRC has estimated that up to £3.5 billion of furlough payments have been made either fraudulently or by error. They have already started to write to some employers where they believe the claims may be incorrect and, therefore, it is important that claims are checked carefully to ensure that they comply with the rules.
For those employees which have been furloughed under the CJRS and are continuously employed until at least 31 January 2021, a £1,000 grant may be payable to the employer under the job retention bonus. For further details on eligibility for this grant, please read our article here.
The Chancellor has also announced a new job support scheme which will run from 1 November 2020 to 30 April 2021. For further details on this read our article here.