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Resources for bookkeepers

Last updated: 6 August 2021 with updates on SEISS grants, time to pay (VAT)

 

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For detailed information on all of the main areas covered click on the links below:

Introduction: Government Support for Businesses and the Self-Employed

ICB Helpline

ICB TV

Support for businesses: Time to Pay service and VAT deferral

Coronavirus Job Retention Scheme and Furloughed workers

Self-employment Income Support Scheme

Statutory Sick Pay (SSP) Rebate

Support for business rates

Support through business grants

The Kickstart Scheme

More coronavirus advice

FAQs

Introduction: Government Support for Businesses and Self-Employed

Businesses and the self-employed are asking bookkeepers for advice on maintaining cashflow; dealing with staff issues, tax payments, business rates, etc. The Chancellor has set out a package of temporary, timely and targeted measures to support public services, people and businesses through this period of disruption caused by COVID-19, but new guidance is being issued daily. Because some elements of business support are devolved, the measures you can access may differ if your business is in Scotland, Wales or Northern Ireland.

Businesses in Scotland

View the latest guidance on coronavirus for businesses in Scotland.

Businesses in Wales

View the latest guidance on coronavirus for businesses in Wales.

Businesses in Northern Ireland

View the latest guidance on coronavirus for businesses in Northern Ireland

ICB Helpline

You can call ICB on 0203 405 4000 to speak to our technical experts on employment and HR related issues, as well as VAT and general tax. You can also call us just to hear a friendly voice on the end of the phone. We are here for you and all of our staff are continuing to work from home.

ICB TV

Join our regular ' Thank Fourlough its Friday' broadcast from the comfort of your own home. We're answering your questions and discussing the latest announcements and how they affect your business and the businesses you work with.

Click here to find out more or select ICB TV from the right hand side menu 

Support for businesses: Time to Pay service and VAT deferral

HMRC Time To Pay Scheme: all UK-tax paying businesses and self-employed people in financial distress, and with outstanding tax liabilities, may be eligible to receive support with their tax affairs through HMRC’s Time To Pay service. These arrangements are agreed on a case-by-case basis and are tailored to individual circumstances and liabilities. Read more.

These arrangements are agreed on a case-by-case basis and are tailored to individual circumstances and liabilities.

Eligibility

You are eligible if your business:

  • pays tax to the UK government
  • has outstanding tax liabilities

How to access the scheme

If you have missed a tax payment or you might miss your next payment due to COVID-19, please call HMRC’s dedicated helpline: 0800 024 1222.

VAT payment deferral for UK businesses: the government deferred the VAT payments due between 20 March 2020 and 30 June 2020.

The portal for applying for the deferred payment of VAT from 2020 is now closed. If no agreement has been made then penalties and interest will now be charged

Note: the agreement will cover the whole of the deferred VAT so if part payments have already been made the business will have to contact HMRC to amend the current agreement.


Read more

Self-assessments tax payment deferral: payments due on the 31 July 2020 will be deferred until the 31 January 2021 Update 24 September 2020 - deferred payments now extended 12 months from January 2021  Read more

Call the HMRC Coronavirus Helpline sooner rather than later:

Telephone: 0800 024 1222
Monday to Friday, 8am to 8pm
Saturday, 8am to 4pm

If you are worried about loss of income

Whether you are currently in or out of work, whether employed or self employed, if you are on a low income and affected by the economic impacts of COVID-19, you will be able to access the full range of the welfare system, including Universal Credit. Your income may be affected due to working less, no longer working, self-isolating, or caring for someone who is sick. You may be able to receive:

1. Sick Pay
2. Contributory Employment and Support Allowance
3. Contributory Jobseekers Allowance
4. Universal Credit
5. Council Tax Support
6. Rent Rebate (Northern Ireland)
7. Help with your rent
8. Help with your mortgage
9. Free School Meals

Universal Credit for the Self-employed

If you are self-employed (or otherwise ineligible for SSP) you are able to claim Universal Credit, providing you meet the usual eligibility criteria.

To support you with the economic impact of the outbreak, and allow you to follow government guidance on staying at home, from 6 April the requirements of the Minimum Income Floor will be temporarily relaxed. This change will apply to all Universal Credit claimants and will last for the duration of the outbreak.

From 6 April the standard allowance in Universal Credit and the basic element in Working Tax Credit are being extended for one year. Both will increase by £20 per week on top of planned annual uprating. This will apply to all new and existing Universal Credit claimants and to existing Working Tax Credit claimants.

This has now been extended to 30 September but from 1 April, will be paid in a single lump sum of £500.

If required you can access advance payments up front without needing to attend a jobcentre. 

https://www.gov.uk/universal-credit 

If you live in Northern Ireland, go to Universal Credit in Northern Ireland

Support for rent costs

You should check your eligibility for Universal Credit, which is available for people in and out of work. Support for rental costs will be paid through Universal Credit.

From April, there is an increase to Local Housing Allowance rates to the 30th percentile of market rents. This applies to all private renters who are new or existing Universal Credit housing element claimants and to existing Housing Benefit claimants.

For more information click here

Coronavirus Job Retention Scheme and Furloughed workers

ICB Job Retention Scheme details, templates and FAQs

The furlough scheme has been extended to 30 September 2021. It is a flexible scheme with workers being paid their full rate for any worked or training hours, with furlough being claimed for hours that are not worked for Coronavirus reasons. Workers can undertake work for another employer, carry out voluntary work or training. While on furlough, the employee’s wage will be subject to usual income tax and other deductions.

Employers must discuss becoming classified as a furloughed worker with their employees. If an employee's salary is reduced as a result of these changes, they may be eligible for support through the welfare system, including Universal Credit.

Employees you can claim for

For the extended scheme, operational from 1 November 2020, furloughed employees must have been on your PAYE payroll (and an RTI submittion made) on or before one of two relevant dates - 30 October 2020 and 2 March 2021 - and can be on any type of contract, including:

  • full-time employees
  • part-time employees
  • employees on agency contracts
  • employees on flexible or zero-hour contracts

Eligible individuals who are not employees

As well as employees, the grant can be claimed for any of the following groups, if they are paid via PAYE:

  • office holders (including company directors)
  • salaried members of Limited Liability Partnerships (LLPs)
  • agency workers (including those employed by umbrella companies)
  • limb (b) workers

Employers should discuss with their staff and make any changes to the employment contract by agreement. When employers are making decisions in relation to the process, including deciding who to offer furlough to, equality and discrimination laws will apply in the usual way.

To be eligible for the grant employers must confirm in writing to their employee confirming that they have been furloughed. A record of this communication must be kept for five years.

The Extended Coronovirus Job Retention Scheme that was introduced on1 November 2020 has now been extended until 30 September 2021. It follows very similar rules to that operated under the current flexible furlough scheme until 30 June 2021 i.e. the Government will pay 80% of all  non-worked hours with the employer being responsible for paying worked hours and the Employer's NIC and pension contributions.

For individual worker furlough claims for periods up to and including 30 April 2021, an RTI must have been submitted for the worker on or before 30 October 2020.

For individual worker furlough claims for periods from 1 May 2021 to 30 September 2021, an RTI must have been submitted for the worker on or before 2 March 2021.

Employees do not have to have been previously furloughed to be eligible. The deadline for claiming furlough repayments for each month must be made by either 14th, 15th or 16th of the following month (depending on the month concerned).

Support for workers will be tapered from 1 July 2021. Note: all furloughed workers must be paid 80% of the relevant income for non-worked hours, up to the end of September 2021, capped at £2,500 per month.

Employers can claim furlough repayments as follows:
 
•  To end June 2021 - 80% for furloughed hours. Max claim = £2,500
•  For July 2021 - 70% for furloughed hours. Max claim = £2,187.50 – employer contributes up to £312.50
•  For August and September 2021 - 60% for furloughed hours. Max claim = £1,875 – employer contributes up to £625
•  Employers must pay ER NICs and pension contributions which cannot be reclaimed (as per existing rules)

HMRC may accept late claims if you have:

  • a reasonable excuse
  • taken reasonable care to try and claim on time
  • claimed without delay as soon as you were able to
  • there was an error by HMRC

Full details can be found here.

Resignations and redundancy notice periods - from 1 December, furlough claims cannot be made for any employee who is serving a statutory notice period, whether they hand in their resignation or if they are made redundant.

National Minimum Wage

Furloughed workers must be paid the lower of 80% of their salary, or £2,500 even if, based on their usual working hours, this would be below the National Living Wage/National Minumum Wage. The only exception is if they are required to carry out training for their job whilst on furlough at which point they must be paid at least the NLW/NMW and even if this is more than the 80% of their wage that will be subsidised.

Owner-Managed Companies

Many owner managed company director/shareholders pay small salaries and the balance of income as dividends. The scheme does not extend to dividends. Only the salary is relevant to the scheme. Such companies must have been paying a salary through a payroll to be eligible for a grant. As it stands at present, those directors who are paid annually must also have submitted an RTI return by 30 October to be eligible.

Employee transfers under TUPE and on a change in ownership - A new employer is eligible to claim in respect of the employees of a previous business transferred if the TUPE or PAYE business succession rules apply to the change in ownership.

The employees being claimed for should have been:

  • had an RTI submitted by either their old employer or new employer on or before 30 October 2020 (for claims up to 30 April 2021)
  • had an RTI submitted by either their old employer or new employer on or before 2 March 2021 (for claims from 1 May to 30 September 2021)

Note: the introduction of the Job Support Schemes and also The Job Retention Bonus (as originally announced in 2020) have both been delayed due to the national lockdown and the extension of the CJRS to 30 September 2021.

Penalties - the Government has announced that all corrections to claims under CJRS must have been made 90 days after the claim date. This covers both under and over claims. If HMRC is  notified voluntarily of an over claim then no penalty will be imposed if the overpayment is refunded to them but if errors are found by HMRC as part of an investigation then not only will the overpayment have to be repaid but HMRC may impose a penalty of between 50% and 100% of the amount due. Small overpayments claimed in good faith are still OK provided that full calculations are kept but larger amounts (and HMRC do not specify any amount) must be corrected.
Read more

The Employer's Allowance and CJRC claims for NICs - it has now been confirmed that it is not possible to claim for both the EA and the NIC part of the CJRS claim. There has been some confusion over the date of claiming the EA but information from HMRC has confirmed the situation is as follows:

  • If you claimed the CJRS grant in April and decide to claim the EA at a later date (say November 2020) then HMRC have confirmed that any claim under CJRS will be absorbed into the EA. If (say) the claim under CJRS was for £3,000 of NICs then only a further £1000 can be claimed via the EA taking the full claim for the tax year to £4000
  • If you claimed the EA from April then once the £4000 has been utilised you can claim additional amounts over and above this via the CJRS until the scheme ends.

Self-employment Income Support Scheme

The Self-employment Income Support Scheme (SEISS) will support self-employed individuals (including members of partnerships) who have lost income due to coronavirus (COVID-19).

If you’re a director of your own company and paid through PAYE you are not eligible for this grant but you may be able to get support using the Job Retention Scheme.

Make a claim:  

A 5th and final grant has been announced that will cover the period 1 May to 30 September 2021. the level of the 5th grant will be based on the percentage reduction in profits.
 
The maximum grant will be 80% of taxable profits over the relevant period, capped at £7,500 (£50k profit) but only for those whose turnover has been reduced by 30% or more.
 
If turnover reduced by <30%, the grant will be 30% of 3 months average trading profit, capped at £2,850 -  note if they were newly self-employed with no previous trading in the 3 years prior they should automatically get the 80%
 
•Grant covers period of 5 months (May to September) but will only be 3 months of profits – so less than earlier grants
•YouTube video for agents to view the whole process and to assist clients https://www.youtube.com/watch?v=eF3RfPToyxY
•Takes you through the service so useful to watch to assist your clients - the process will show details of previous grants paid out
•Declaration will need to be made that they are still self-employed (unless temporarily for Covid reasons) and that the profits for May-September 2021 will be badly affected due to CV
•Additional questions if they have foreign income
•Need to carry out additional steps if a previous tax return has been amended (since 3 March 2021)
•Will see the amount of grant at the end of the process with a claim reference
•Be aware of scams!
•Watch out for reporting the previous claims in the tax return for 2020-21 as many have already been submitted with errors
•HMRC have contacted some customers who started trading in 2019-20 and also claimed the fourth SEISS grant, to confirm their identity and business activity.
•These customers will not be able to make a claim for the fifth SEISS grant until they respond to HMRC, providing the information we ask for to verify their identity.

Statutory Sick Pay (SSP) Rebate

HMRC will bring forward legislation to allow small-and medium-sized businesses and employers to reclaim Statutory Sick Pay (SSP) paid for sickness absence due to COVID-19. The eligibility criteria for the scheme will be as follows:

  • this refund will cover up to 2 weeks’ SSP per eligible employee who has been off work because of COVID-19 (see below for eligibility and claim dates)
  • employers with fewer than 250 employees will be eligible - the size of an employer will be determined by the number of people they employed as of 28 February 2020
  • employers will be able to reclaim expenditure for any employee who has claimed SSP (according to the new eligibility criteria) as a result of COVID-19
  • employers should maintain records of staff absences and payments of SSP, but employees will not need to provide a GP fit note. If evidence is required by an employer, those with symptoms of coronavirus can get an isolation note from NHS 111 online and those who live with someone that has symptoms can get a note from the NHS website
  • eligible period for the scheme will commence the day after the regulations on the extension of SSP to those staying at home comes into force

You are eligible for the scheme if:

  • your business is UK based
  • your business is a small or medium-sized and employs fewer than 250 employees as of 28 February 2020


The repayment will cover up to two weeks of the applicable rate of SSP. You can claim for periods of sickness starting on or after:

  • 13 March 2020 - if your employee had coronavirus or the symptoms or is self-isolating because someone they live with has symptoms
  • 16 April 2020 - if your employee was shielding because of coronavirus
  • 28 May 2020 - if your employee has been notified by the NHS or public health bodies that they’ve come into contact with someone with coronavirus

 Employees do not have to give you a doctor’s fit note for you to make a claim. But you can ask them to give you either:

  • an isolation note from NHS 111 - if they are self-isolating and cannot work because of coronavirus (COVID-19)
  • the NHS or GP letter telling them to stay at home for at least 12 weeks because they’re at high risk of severe illness from coronavirus

How to access the scheme

The claim portal is now open. You will need the provide your PAYE reference, a list of employee names and the total amount being reclaimed.

Support for business rates

HMRC introduced a business rates holiday for retail, hospitality and leisure businesses in England for the 2020 to 2021 tax year. This has now been extended to 30 September 2021 but as a tapered relief.

Eligibility

You are eligible for the business rates holiday if:

  • your business is based in England
  • your business is in the retail, hospitality and/or leisure sector

Properties that will benefit from the relief will be occupied hereditaments that are wholly or mainly being used:

  • as shops, restaurants, cafes, drinking establishments, cinemas and live music venues
  • for assembly and leisure
  • as hotels, guest & boarding premises and self-catering accommodation

The 100% discount will remain in place until 30 June 2021.

From July until March 2022 there will be further discounts of up to 2/3 with lower discounts if businesses are kept open – capped at £2million and applying only to those businesses who were forced to shut in the latest lockdown

How to access the scheme

There is no action for you. This will apply to your next council tax bill in April 2020. However, local authorities may have to reissue your bill automatically to exclude the business rate charge. They will do this as soon as possible.

You can estimate the business rate charge you will no longer have to pay this year using the business rates calculator.

Further guidance for local authorities is available in the expanded retail discount guidance.

Cash grants for retail, hospitality and leisure businesses

The Retail and Hospitality Grant Scheme provides businesses in the retail, hospitality and leisure sectors with a cash grant of up to £25,000 per property.

Businesses in these sectors with a property that has a rateable value of £15,000 and under will receive a grant of £10,000.

Businesses in these sectors with a property that has a rateable value of between £15,000 and £51,000 will receive a grant of £25,000.

Eligibility

You are eligible for the grant if:

  • your business is based in England
  • your business is in the retail, hospitality and/or leisure sector

Properties that will benefit from the relief will be occupied hereditaments that are wholly or mainly being used:

  • as shops, restaurants, cafes, drinking establishments, cinemas and live music venues
  • for assembly and leisure
  • as hotels, guest and boarding premises and self-catering accommodation

How to access the scheme

You do not need to do anything. Your local authority will write to you if you are eligible for this grant.

Guidance for local authorities on the scheme will be provided shortly.

Any enquiries on eligibility for, or provision of, the reliefs and grants should be directed to the relevant local authority.

Find your local authority.


Support for nursery businesses that pay business rates

We will introduce a business rates holiday for nurseries in England for the 2020 to 2021 tax year.

Eligibility

You are eligible for the business rates holiday if:

  • your business is based in England

Properties that will benefit from the relief will be hereditaments:

  • occupied by providers on Ofsted’s Early Years Register
  • wholly or mainly used for the provision of the Early Years Foundation Stage

How to access the scheme

There is no action for you. This will apply to your next council tax bill in April 2020. However, local authorities may have to reissue your bill to exclude the business rate charge. They will do this as soon as possible.

You can estimate the business rate charge you will no longer have to pay this year using the business rates calculator.

Further guidance for local authorities is available in the nursery discount guidance.


Support for businesses that pay little or no business rates

The government will provide additional Small Business Grant Scheme funding for local authorities to support small businesses that already pay little or no business rates because of small business rate relief (SBBR), rural rate relief (RRR) and tapered relief. This will provide a one-off grant of £10,000 to eligible businesses to help meet their ongoing business costs.

Eligibility

Eligibility requirements and claim procedures differ in England, Scotland, Wales and Northern Ireland, but businesses have to occupy property to qualify. Premises that have closed temporarily due to the government’s advice on COVID-19 will be treated as occupied for the purposes of this relief.

  • your business is based in England
  • you are a small business and already receive SBBR and/or RRR
  • you are a business that occupies property

How to access the scheme

Grants will be paid automatically by local authorities. Businesses will not need to apply for them (except in Scotland).

Any enquiries on eligibility for, or provision of, the reliefs and grants should be directed to the relevant local authority.

Find your local authority.

Support for businesses through Grants

Applictions for the existing Coronavirus Business Interruption Loan and the Bounce Back Loan Schemes will close on 31 March 2021. A new Recovery Loan scheme opens on 6 April (and closes on 31 December 2021) for applications between £1,000 and £10 million. The following applies:

•The Government guarantees 80% for loans between £25,001 and £10 million
•Applicants may be asked to provide personal guarantees for amounts over £250k
•The scheme is open to those who have already accessed existing loans
•Can be used for any legitimate business purpose, including growth and investment and must show that they have been affected by the pandemic and that they are viable, or would be viable if not for the Coronavirus outbreak
 
There are two new grants available for training
 
•Help To Grow – management training grants with Government contributing 90% of the cost
•SMEs – free training and grants of up to 50% towards the cost of digital software – starts in the Autumn but register interest now

The Kickstart Scheme

The Kickstart scheme is available to all  business in Great Britain. The requirement for access to the Kickstart Scheme has been reduced from 30 positions to a single job vacancy. The Scheme provides funding to create new job placements for 16 to 24 year olds on Universal Credit who are at risk of long term unemployment. Employers of all sizes can apply for funding which covers:

  • 100% of the National Minimum Wage (or the National Living Wage depending on the age of the participant) for 25 hours per week for a total of 6 months
  • associated employer National Insurance contributions
  • employer minimum automatic enrolment contributions

Employers can spread the start date of the job placements up until the end of December 2021. Details can be found here.

More coronavirus advice

If you live in Scotland or Wales, keep up to date with your government’s coronavirus advice on:

FAQs

Question

Answer

ELIGIBILITY FOR CJRS – Which employers are eligible for CJRS?

All employers with a UK bank account and UK PAYE are eligible for this scheme, fully funded public organisations are not expected to use this scheme.

The extended CJRS is applicable to employers or employees who have not used CJRS previously; however, they must fulfil the qualifying requirements.

Employers can claim if employees were employed on or before 2nd March 2021 as long as the PAYE real time information submission to HMRC was made between 20th March 2020 and 2nd March 2021.

For employees on fixed term contracts of employment; claims for CJRS can be made for periods on or after 1st May as long as the employee was employed on 2nd March 2021.

ELIGIBILITY

Does the scheme apply equally to all employees?

 The scheme is open to all UK employers with a UK bank account and UK PAYE Scheme.

Employers can claim if employees were employed on or before 2nd March 2021 as long as the PAYE real time information submission to HMRC was made between 20th March 2020 and 2nd March 2021. You can claim for any type of employee on any employment contract:

  • Full time
  • Part time
  • Apprentices*
  • Employees on agency contracts
  • Employees on fixed term contracts
  • Employees on flexible or zero hours contracts

Foreign nationals are eligible to be furloughed, grants under the scheme are not considered as access to public funds therefore you can furlough employees on all categories of visa.

*Apprentices can continue to train and must be paid at least the Apprenticeship Minimum Wage/National Living Wage/National Minimum Wage as appropriate for the time they spend training, meaning you must cover any shortfall.

ELIGIBILITY

How should an employer agree furloughed status with an employee i.e. in writing?

Your affected employees will need to be designated ‘furloughed workers’ and this will need to be agreed with

employees and confirmed in writing.

Furlough agreements must be in place before the start of a claim period. The agreement can be amended during the claim period.

A record of this communication must be retained for 5 years.

It is important to note that changing employees’ employment rights is still subject to employment law and unless lay off or short time working clauses are included in contracts of employment, separate negotiation will be required. It is best to take employment advice on this point.

Can workers be REQUIRED TO TAKE furlough leave?

Employees must agree to be placed on furlough; they cannot be forced. However, furlough is an alternative to permanent options, such as redundancy.

TRADE UNIONS

Can Trade Unions negotiate on behalf of employees?

Yes, this is possible but only where the company have a collective agreement in place with a recognised trade union.

Can I RE-HIRE staff who I have recently made redundant and back date the claim?

If you made employees redundant, or they stopped working for you on or after 23 September 2020 you can re-employ them and put them on furlough. This applies as long as the employee was employed by you on 23 September 2020 and you made a PAYE Real Time Information (RTI) submission to HMRC between 20 March 2020 and 30 October 2020, notifying a payment of earnings for that employee.

Please note where an employee is furloughed, they will continue to accrue employment rights; therefore this must be considered carefully.

Can employers CONTINUE TO CONTACT furloughed employees?

The employee cannot work for you during the period of furlough (even making phone calls or sending email); however, it is okay to periodically keep in touch from an employee welfare aspect.

Where an employee is on flexi furlough, this means the days / hours they are on furlough.

Can DIRECTORS furlough themselves?

Directors are eligible to be furloughed provided they meet the necessary criteria.

What is different is that company directors have duties to their company as set out in the Companies Act 2006 therefore the decision should be made by the board and formally adopted within the company records.

Directors will be able to carry out their particular duties to satisfy the statutory obligations of the company without falling foul of the furlough rules, provided they do no more than would reasonably be judged necessary for that purpose; however they cannot carry out work that would generate revenue or provide services to benefit the company.

SALARY

What is the definition of "salary" on which 80% pay should be calculated on?

This is based on salary and any regular payments you are obliged to pay for such as past overtime, fees, and compulsory commission payments. Discretionary bonuses (including tips), commission payments and non-cash payments should be excluded. Employers continue to make Employers National Insurance contributions and minimum automatic enrolment employer pension contributions.

There is a maximum monthly payment cap of £2,500 for employees.

The government have issued further guidance on how to make the calculation.

There is also an HM Revenue & Customs example of how to calculate a claim for a flexible furlough employee.

Will I need to TOP UP the other 20%?

You can fund the difference if you wish but there is no legal obligation to do this under the scheme.

 

Please note from 1st July 2021; employers will make a compulsory contribution of 10% and 70% will be paid by the government through the furlough grant and from 1st August the employer contribution will rise to 20% with 60% being paid by the government through the furlough grant.

How will pay be calculated in the case of employees with VARYING REMUNERATION e.g. those working on commission?

You can claim for any regular payments you are obliged to pay; however, discretionary bonus (including tips), commission and non-cash payments are excluded.

If the employee has variable pay; the usual pay calculation is determined by when they were on your payroll.

The rules for the furlough payment differ from the previous system; therefore, it is advised you refer to the calculator available on the Gov UK website.

HMRC PUBLISH INFORMATION

The HMRC publish information about the CJRS claims on the internet. This includes the employer name and a reasonable indication of the amount claimed. This is mandatory unless the employer can show the exposure would cause ‘serious risk of violence and intimidation’ to their workforce.

EVIDENCE

How do employers’ evidence to HMRC that an individual is a furloughed worker?

A schedule of furloughed workers must be produced and submitted to HMRC through the portal created for this purpose. Amount claimed. Remember to keep your salary calculation as HMRC will retain the right to audit.

 After submission, you must keep a note of the reference number issued as there will be no other confirmation issued by HMRC.

HMRC Furlough grant claims

Claim for the furlough grant must be submitted by 11.59pm 14 calendar days after the month you are claiming for. If

this time falls on a weekend or a bank holiday; the claim should be submitted the next working day.

Claim for furlough days in                                                 Claim must be submitted by

 

February 2021                                                                         15 March 2021

 

March 2021                                                                              14 April 2021

 

April 2021                                                                                  14 May 2021

 

May 2021                                                                              14 June 2021

 

June 2021                                                                             14 July 2021

 

July 2021                                                                               16 August 2021

 

August 2021                                                                        14 September 2021

 

 

How much of this process will be AUTOMATED in terms of BACS payments to our business account?

Once HMRC have received your claim and you are eligible for the grant, payments will be made via BACS payment to a UK bank account.

Claims will need to be made in accordance with actual payroll amounts at the point at which you ran your payroll or in advance of an imminent payroll.

REIMBURSEMENT

In what time frame will firms be reimbursed for furloughed workers?

This will be via a grant from HMRC (not a loan). The portal went live on 20 April 2020 and is available to all UK employers who have a UK bank account and UK PAYE payroll scheme.

Employers do not have to have claimed before for the furlough payment.

Since 1st November 2021 there is no maximum limit in the number of employees the employer can claim for. HMRC will check the claim and provided you are eligible will pay into the nominated bank account by BACS.

HMRC aim to make the payments to the nominated bank account six days after receipt of the claim provided your claim matches records that they hold for your PAYE scheme.

You must retain all your claim records for 5 years as HMRC retain the right to audit. Any claims based on inaccurate information will be recovered by HMRC.

Furloughed employees should not contact HMRC as it is the employer who will make the payment to the employee.

PAYE

Will PAYE continue to be deducted in the normal way?

HMRC will pay a grant to the employer must process the furloughed employees through their payroll as normal so PAYE and Employee National insurance contributions will be deducted. Employees will also continue to make automatic enrolment contributions on qualifying earnings unless they have elected to opt out or have ceased savings into a workplace pension plan.

Can furloughed employees continue to have SALARY SACRIFICE deductions taken from their pay?

Agreement will need to be sought before suspending salary sacrifice arrangements as these arrangements have been contractually agreed and would, in general, must be terminated and dealt with subject to that agreement.

We would advise completing a cost – benefit analysis before carrying out this measure as dependant on policies employers and employees may be required to pay more tax and National insurance contributions.

SICK LEAVE

Can employees who are certified as sick be made furloughed workers?

Employees on sick leave should be paid SSP, or sick pay where contractual, for the duration. They can subsequently be furloughed when their period of sickness ends if required as the scheme is not intended for short term sickness.

Employees who are shielding or need to stay at home with someone who is shielding can be furloughed. They do not have to be placed on furlough if they can continue to work from home.

Please note an employer will not be able to recover SSP if you have furloughed an employee.

It should be noted that furloughed employees retain their statutory rights and therefore if a furloughed employee becomes ill, they must be paid at least the SSP rate if they are considered as sick and not furloughed.

OTHER LEAVE

Can employees who are off on any other leave e.g. maternity leave or paternity leave etc be made furloughed workers?

 

For employees on maternity leave the normal rules apply. If you offer enhanced (earnings related) contractual pay to women on Maternity Leave, this is included as wage costs that you can claim through the scheme. The same principles apply where your employee qualifies for contractual adoption, paternity, or shared parental pay.

If an employee returns from maternity or any other parental leave period; you can claim in respect of a period that commences on or after 1st November; the normal scheme rules apply.

If an employee wants to end their maternity leave early to enable them to be furloughed with your agreement; they must give the employer a minimum of 8 weeks’ notice of their return to work. Employers cannot furlough them up to the end of the 8 weeks.

How do I calculate statutory paid PARENTAL LEAVEentitlements for an employee who is a furlough worker?

Furloughed workers are entitled to pay based on their usual earnings rather than at the furloughed pay rate. This will include entitlement to statutory maternity pay and other forms of parental and adoption pay.

WORKING WHILE FURLOUGHED

Can we furlough workers on a rolling basis?

You can furlough employees during the period the scheme is in operation in line with business operational needs subject to the minimum claim period of 7 calendar days.

Employees may be placed on full furlough or flexible furlough.

Flexible furlough enables employees to work part time and be furloughed for the remainder of their contracted hours of work.

WORKING WHILE FURLOUGHED

Can employees work for other employers whilst furloughed

e.g. supermarkets, NHS?

If an employee has more than one employer (multiple jobs), provided it is permitted within your employment contract, they can continue to work for one employer and be furloughed by another. 

If that employer subsequently decides to furlough the same rules apply and they can receive 80% of their salary from that employer. The 80% of salary or £2,500 cap applies to each contract of employment (job).

Additionally, if your contracts of employment allow or you agree, an employee can work commence work for another employer whilst furloughed.

A furloughed employee can take part in volunteer work if it does not provide services to or generate revenue for, or on behalf of your business or a linked organisation.

Please note in both cases above; you should clearly outline to the employee this is a temporary arrangement and they must be able to fulfil the needs of their substantive contract in your employment at short notice.

WORKING WHILE FURLOUGHED

Can furloughed workers be rotated back into the business?

As it is a separate claim for each period, furloughed workers can be brought back into work on a gradual basis as required by the business recovery within the time parameters of the scheme. Other action may need to be considered beyond this date if the business is unable to bring an employee back to work.

WORKING WHILE FURLOUGHED

Can furloughed workers undertake ad hoc work for the business?

Where an employee is on full furlough; they cannot undertake any work for the business.  However, if the employee is on flexible furlough; they may work some hours and be furloughed for the remainder of their contracted hours.

The rules are slightly different for Directors who can undertake statutory obligations of the business under the Companies Act 2006 (provided they do no more than would reasonably be judged necessary for that particular purpose).

ANNUAL LEAVE

Will employees continue to accrue annual leave while furloughed?

Holiday leave continues to be accrued in line with employee’s employment contract during the furloughed period.

ANNUAL LEAVE

How will holiday entitlement and pay be treated during the furlough period?

Whilst an employee is furloughed, no other payments should be made. The employee is in effect temporarily ‘laid off’ as opposed to permanently ‘laid off’.

Employees can request and take holiday days and bank holidays in the usual way during a period of furlough leave. They must however seek agreement from their employer first. Furlough workers must get their usual pay in full for the holiday, bank holidays taken.

Employer can require employees to take their holiday during a period of furlough by giving double the length of notice as the period of holiday. For example, 2 days’ notice for 1-day holiday.

ANNUAL LEAVE

Do we need to pay-up all accrued but unused holiday to the point of furlough?

No. This is not necessary as holiday leave will continue to accrue whilst they are furloughed.

ANNUAL LEAVE

Should I ask employees to take annual leave before furloughing?

This is a matter for each business to consider. The purpose of furloughing is to prevent unemployment and to ease financial pressures on a business in order that it can survive a temporary downturn in business. Asking an employee to take leave will result in the company continuing to pay the employee which in the current climate may not be an attractive proposition.

ANNUAL LEAVE

Are we expected to deduct used but not accrued holidays to this point?

No. The worker will remain an employee during the period of furlough and retain contractual benefits other than that around pay.

PENSIONS

Can we deduct pension, and other voluntary deductions?

Employees will continue to make automatic enrolment contributions on qualifying earnings unless they have elected to opt out or have ceased savings into a workplace pension plan.

WHAT OPTIONS do we have to give our employees?

The aim of Coronavirus Job Retention Scheme (CJRS) is for businesses to retain employees during the period in order

that they can bring them back when the business situation improves (subject to the current scheme duration).

Can furloughed workers receive

TRAINING?

A furloughed employee can take part in training as long as it does not provide services or revenue to the business. If workers are required to complete training in connection with the business, they must be paid the National Living Wage or National Minimum Wage for the time spent training, meaning you may have to top up at the companies expense.

Will REDUNDANCIES be

considered unfair in circumstances where employers could have applied for the scheme?

Companies should explore all options and adopt the best option for their company. The CJRS is to avoid mass redundancies and unemployment; however, in some cases there may be no alternative.

Is CONSULTATION in a

redundancy situation compulsory; especially where employer is facing financial uncertainty?

Companies must ensure they always follow due process; failure to do so will result in unfair dismissal claims. Employment Tribunals may be sympathetic to the current situation but will not look favourably where companies have deliberately failed to follow a fair and reasonable process.

Can we use furlough grant for the NOTICE PERIOD payment where an employee’s employment is being terminated/ ending?

Claims cannot be made for any day in which an employee is servicing notice during the furlough period. This applies to both statutory and contractual notice.

This includes employees who are serving notice of resignation or retirement.

Will the scheme be EXTENDED

beyond 30th April 2021?

The government has not commented on this; however this is a fluid situation.

CAN STAFF REFUSE to be

furloughed?

Yes, staff must agree to be furloughed and cannot be forced. If an employee refuses; the company should consider alternative options for example, redundancy.

I understand that the employment contract must allow VARIATION IN TERMS at company discretion otherwise a consultation period of a month is needed. If this is done, I assume the company can still back date the application of the furlough?

Typically, where there is no contractual clause to vary the contract or lay off employees; employers must enter a period of consultation and seek employee agreement prior to applying the changes to the contract. However, this is an exceptional situation and many companies do not have time to conduct a consultation period.

The government have offered the CJRS and therefore companies should discuss the options with their staff openly and frankly and seek agreements from staff. The aim is to avoid a redundancy situation.

Does the company have to prepare a CONTINUITY PLAN to apply for furlough

No continuity plan is required to apply for a CJRS grant, however when selecting employees, employers should be aware that equality and discrimination laws will apply in the usual way.

Can HOLIDAY LEAVE be carried over?

Working Time Regulations has been amended. Workers who have not taken all their statutory annual leave entitlement due to COVID-19 will now be able to carry up to 4 weeks over into the next 2 leave years.

If making staff redundant after furlough has ended, do NORMAL REDUNDANCY RULES apply?

Yes, the usual redundancy procedure will apply, and payments should be made according to the redundancy policy if the organisation have one or statutory redundancy guidelines.

Can VOLUNTARY DEDUCTIONS

e.g. private medical insurance continue to be deducted from employees on furlough?

Yes, providing the scheme is still in operation and the employee has no objection to continuing with their scheme.

Can an employee PAY FREQUENCY change during furloughed status?

This is subject to agreement from the employee to change their payment frequency.

Can firms insist that employees undertake PERSONAL DEVELOPMENT while on furlough?

Training is permitted providing the employee does not provide services to or generate revenue for the employer whilst undertaking it.

If employees are required by you to undertake training (such as online training) while on furlough, they must be paid at least the National Living Wage/National Minimum Wage, even if that is more than the level of their 80% subsidised pay under the scheme.

 

 

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