From October 1st, employees enrolled in the Coronavirus Job Retention Scheme (or furlough) will only have 60% of the wages paid by HMRC, with the remainder being provided by the employer.
While the total wages paid to the employee will not change, up to a cap of £2500 per month, HMRC will reduce its contributions to the scheme to £1875 per month, or 60% of total wages, with the difference funded by the employer. For staff working reduced hours through the flexible furlough scheme, caps and contributions are proportional to the hours not worked. Employers are also required to pay for employer National Insurance and pension contributions.
Claims for payments from HMRC for the Coronavirus Job Retention Scheme can be made online: this includes templates for submitting claims for over 100 employees at a time, as well a calculator tool for claims.
HMRC also recommend checking previous claims to avoid penalties for overclaiming through the furlough scheme, as well as interest on overpayments. Any repayments must be repaid by the latest of the following:
- 90 days from receiving the CJRS money you’re not entitled to
- 90 days from the point circumstances changed so that you were no longer entitled to keep the CJRS grant
- 20th October 2020, if on or before 22 July you received CJRS money you’re not entitled to, or if your circumstances changed.
Guidance and live and recorded webinars from HMRC are also available to offer further support on the changes to the scheme, that can be booked online.