The ability to claim a government grant in respect of furloughed employees under the Coronavirus Job Retention Scheme (CJRS) went live today.
We have had the opportunity to test the portal and therefore can provide the following information for those clients who are looking to undertake their own submissions.
(Note: the CJRS has been extended to 30th June 2020)
You will need access to PAYE online
This can be found in the businesses online tax account section, and can be accessed using your government gateway ID and password). If you have not set this up previously, you can do so now.
Extension to Furloughed Employees
Employees on payroll from 19th March 2020 are now eligible for the scheme (this is an extension from previously, where only employees on the payroll at 28th February 2020 were eligible to be furloughed)
For salaried employees, the claim is restricted to the salary as of 28th February 2020. Commissions and bonuses should not be included within your furlough pay calculations.
For those employees on minimum wage, it is possible that they will receive less than minimum wage through furlough pay (the national minimum wage increased on 1st April 2020).
This is legal, as they are not working and minimum wage only applies where an individual is working.
Employer NI Claim
Furlough pay can be claimed for 80% of an individual’s gross pay, up to a maximum of £2500 (gross)
The claim for Employers NI is on top of this (note, only 80% of the employers NI can be claimed)
Be aware if you are making a claim for Employers NI, as many businesses (particularly in the new tax year) will be utilising their employment allowance, and therefore should not be claiming employers NI through the furlough scheme
Employer Pension Contributions
If the business contributes to an employee’s pension scheme under auto-enrolment, you can claim additionally for the employer pension cost.
This is restricted to the minimum contribution level of 3%.
As with the salary and Employer NI, only 80% of the employer pension contribution can be claimed back.
HMRC have provided the following online calculator to assist taxpayers: https://www.tax.service.gov.uk/job-retention-scheme-calculator/
In addition to the calculation of how much furlough pay the business is claiming, you will require:
- Employer PAYE reference number
- Number of employees being furloughed
- National Insurance Numbers for the furloughed employees
- Names of the furloughed employees
- Payroll/employee number for the furloughed employees (optional)
- Your Self-Assessment Unique Taxpayer Reference or Corporation Tax Unique Taxpayer Reference or Company Registration Number
- Claim period (start and end date). It should be noted that you can only make a claim for up to 14 days in advance.
- Amount claimed (per the minimum length of furloughing of 3 consecutive weeks)
- Bank account number and sort code
- Contact name
- Contact phone number
The portal is fairly simple to use and we image many readers will be able to make the submissions themselves.
However, should you require assistance, please do contact us as we are happy to process this for a nominal charge.