PAYE payment and furlough eligibility extensions

Companies that have cash flow difficulties and are unable to meet their PAYE liabilities as a result of the coronavirus crisis may be able to defer their payments.

HMRC is urging anyone worried about any payments to contact them to discuss the options available.

That could include a payment extension. It is understood that if required the taxman will defer PAYE bill payments for up to three months, where the business is adversely impacted by coronavirus.

This is not an automatic deferral. However, WNJ has successfully applied for a PAYE payment extension on behalf of one of its clients.

Applying for a payment extension might also be an option for businesses struggling to pay other taxes which aren’t automatically deferred under the government’s coronavirus support measures, including Corporation Tax and CIS.

The government has also announced that during the outbreak the annual interest on deferred tax payments will be waived.

HMRC has also set up a dedicated helpline. For more details visit: https://www.gov.uk/government/organisations/hm-revenue-customs/contact/coronavirus-covid-19-helpline

Meanwhile, the government has extended the start date for eligibility for furlough to March 19 from the original February 28 date, meaning that 200,000 more people can benefit from the scheme.

Under the scheme employers can claim a grant covering 80 per cent of the wages for a furloughed employee, with a cap of £2,500 a month.

To qualify and to protect against fraudulent claims, individuals originally had to be employed on February 28, 2020.

But following a review of the delivery system and to ensure the scheme helps as many people as possible, new guidance has confirmed the eligibility date has been extended to March 19, 2020 – the day before the scheme was first announced.

Employers can now claim for furloughed employees that were employed and on their PAYE payroll on or before March 19, 2020.

The employee must have been notified to HMRC through an RTI submission notifying payment in respect of that employee on or before that date.

A HMRC spokesman said: “This change makes the scheme more generous while keeping the substantial fraud risks under control and is expected to benefit over 200,000 employees.”

It has also been confirmed that the scheme is set to be fully operational next week with the online portal going live on April 20.

More information on the scheme is available here: https://www.gov.uk/guidance/claim-for-wage-costs-through-the-coronavirus-job-retention-scheme