A practical guide to claiming funds from the Coronavirus Job Retention Scheme
What can you do to prepare?
To claim under the Scheme, you will need to be registered with PAYE Online. If you Those already have an HMRC Online account, you can enrol for PAYE services through that account, but otherwise, it will be necessary to enrol as a new user. An activation code will be sent within 10 days of enrolling but please note that it might be posted to a business address, even if it is closed because of lockdown.
What period can you claim for?
The Scheme has been backdated to 1 March 2020, but claims can only be backdated if the employee either agreed not to carry out any work, or was made redundant and reinstated, before being furloughed. Otherwise, claims should begin from the date that furlough began.
The Scheme has been extended to 30 June 2020, but it will not yet be possible to claim any pay for May or June. Claims can be made no more than 14 days before payroll is run. Further applications for funds under the scheme will be necessary for any future periods of furlough.
What information will you need to provide?
You will need to give a PAYE reference number, a taxpayer reference number, bank details, a contact name and phone number, and the number of employees being furloughed.
You will need to provide a name, National Insurance number, claim period and claim amount for each employee. If fewer than 100 staff are furloughed, details must be entered into the system manually. If there are 100 or more, a spreadsheet can be uploaded instead.
The government website includes an online calculator to help calculate the amount to claim.
HMRC will audit the claims using information obtained from previous PAYE submissions. As a result, it is not possible to claim for new employees where no submissions have been made.
When will you receive the money?
HMRC has said that its first payments will be made on 30 April 2020, ten days after the portal opens. It anticipates that subsequent applications will be processed within four to six days.
Furlough and holiday clarification
After much debate among practitioners, the Government has now given guidance about how the furlough of employees interacts with their right to take paid holiday. It has unsurprisingly confirmed that statutory holiday continues to accrue while on furlough, and it has confirmed that holiday can be taken while on furlough. The Government will make furlough payments if an employee is taking holiday, but the employer might have to top up the payments to 100% in many cases, even if the employee has agreed to be paid at 80% of salary during furlough.
For employees who do not usually work bank holidays, you have the option to offer an additional day of holiday in lieu, but you do not have to do so. You can instead use furlough payments to cover the cost of holiday pay, topping it up where necessary. The guidance is also clear that you can refuse the holiday requests of employees during busy periods, for example if you expect there to be a backlog of work once furlough has come an end, but it is less clear whether you can insist upon employees taking their holiday while on furlough.
However, this might not quite be the final word on the subject. The Government says that it is keeping its policy under review and there could still be further changes to it in the future.