Coronavirus Job Retention Scheme: guidance update for employers

HMRC has now updated its guidance for employers on how to make claims under the government’s Coronavirus Job Retention Scheme (CJRS).

The guidance explains how changes to the scheme will take place from July 1, including the introduction of flexible working.

The taxman says that the first-time employees will be able to make claims for days in July will be July 1. You cannot claim for periods in July before this point.

July 31 is the last day that employees can submit claims for periods ending on or before June 30.

If you haven’t already, you must decide the length of your claim period. From July 1, your employees can return to work and still be furloughed for the rest of the time they would normally work for you.

If this is the case, you must work out your employee’s usual and furloughed hours before you can start calculating your claim.

From July 1, you will:

• Only be able to claim for employees who have previously been furloughed for at least three consecutive weeks taking place any time between March 1 and June 30
• Be able to flexibly furlough employees – this means you can bring your employees back to work for any amount of time, and any work pattern
• Still be able to claim the furlough grant for the hours your flexibly furloughed employees do not work, compared to the hours they would normally have worked in that period

From August 1, the level of the grant will be slowly reduced. No grant will be available for Class 1 employer NICs or pension contributions from that date, although these contributions will remain payable by the employer.

From September 1, you will also be asked to contribute towards the cost of your furloughed employees’ wages to ensure they continue to receive at least 80 per cent of their wages for the time they’re on furlough.

Employers will still need to pay employer National Insurance and pension contributions on furloughed employees’ pay. For claims ending before August 1 you can claim for these costs too.

You cannot claim for:

• additional National Insurance or pension contributions you make because you choose to top up your employee’s wages
• Your employees’ wages for any time they spend working, or any National Insurance or pension contributions you make on these wages
• any pension contributions you make that are above the mandatory employer contribution

You can choose to top up your employees’ wages above the minimum furlough pay amount but you do not have to.

Employees must not work or provide any services for the business during hours which they are recorded as being on furlough, even if they receive a top-up wage.

HMRC says that employers must keep a copy of all records for six years, including:

• the amount claimed and claim period for each employee
• the claim reference number for your records
• your calculations in case HMRC need more information about your claim
• usual hours worked, including any calculations that were required, for employees you flexibly furloughed
• actual hours worked for employees you flexibly furloughed

The Coronavirus Job Retention Scheme will close on October 31.