Government change of heart
Previously – employees that were employed on or before 28th February 2020 and were on the PAYE payroll as at that date could be furloughed.
Now – employers can make a furlough claim in respect of employees who were employed and were on the PAYE payroll on or before 19th March 2020. This means an RTI submission notifying payment in respect of that employee to HMRC must have been made on or before 19th March 2020.
If an employee is transferred from a previous business to a new business after 19th March 2020 and the TUPE or PAYE Business Succession rules apply to the change of ownership, then the new employer can make a claim under the CJRS if those employees are subsequently furloughed.
Records to be kept
Furlough agreements records must be kept by the employer for at least 5 years.
Where company directors are furloughed, it should be a formally adopted decision made by the Board, noted in the company records and communicated in writing to the director concerned.
All records and information regarding how the claim was calculated should be retained by the employer.
Full or part-time employees’ salary 80% calculation
Previously – the 80% claim calculation was based upon the employee’s salary as at 28th February 2020.
Now – you can opt for 80% of the employee’s salary as per their last pay period up to 19th March 2020.
When making the claim
- If you have fewer than 100 furloughed employees you will be asked to enter details of each employee directly into the system. This will include their name, NI number, claim period, claim amount and payroll/employee number (optional).
- If you have 100 or more furloughed employees, you will be asked to upload a file with the information on rather than input it directly into the system. HMRC will accept the following files: .xls .xlsx .csv .ods
- The scheme is still aiming to go live from 20 April.
- The first payments are likely to be made between 6 -10 days later.
- Claims should be started from the date on which the employees finished work or when they started furlough, not when the decision is made or when they are written to in order to confirm their furlough status.
- Future claims should be paid within 4 to 6 days.
- Following the initial backdated claims, future ones can be made no more than 14 days before payrolls are run but will be accepted for the different pay periods.
- An online whistle-blower service for workers to report employers who abuse the system will be set up.
- Beta testing is now being carried out by selected employers on the portal.
- 2000 HMRC staff will be redeployed for CJRS support.
- Mr Jim Herra of the HMRC Executive believes the portal can deal with up to 450,000 users per hour.
- Mr Herra also believes that 2 million PAYE schemes will be making claims in the first few days of the portals existence.