Charlotte Edwards: Coronavirus Job Retention Scheme & Portal - Latest Updates
Last month we discussed the impact the COVID-19 outbreak continues to have on Scottish businesses across the construction industry, and shared some of the practical steps businesses can take now. Since then we have found that top of the agenda for most businesses in the sector is looking to access the Coronavirus Job Retention Scheme, more commonly referred to as “furloughing” of employees.
This won’t come as a surprise given that the sector’s operations continue to be at a standstill and timescales for when activity will pick back up still are still unknown. Utilising the Government’s furlough scheme has been one of the most proactive steps businesses in the sector have taken to try and safeguard cashflow.
The furlough scheme was announced by the Government on Friday 20 March, 2020, essentially as an agreed leave of absence between an employer and an employee as an alternative to redundancy. Since the announcement date the Government has released a number of updates and clarity on who qualifies for the scheme and the various requirements for making claims, but to qualify, employers must have a valid PAYE reference and have a UK bank account for monies to be paid into.
The portal for making claims through the furlough scheme opened on Monday 20 April, 2020 and over 185,000 businesses applied on day one, covering 1.3 million workers which shows the volume of businesses using this scheme.
Having already completed over 100 claims on behalf clients, currently totalling over £2 million, AAB’s summary below includes some of the key points to be aware of in making a claim and navigating the portal include:
- You need to confirm, in writing, to the employee being furloughed and keep the correspondence on file for at least five years. The employee doesn’t need to respond provided the confirmation of furlough is done in a way that is consistent with employment law
- Claims can only be made once every 3 week period
- If you have more than one payroll per PAYE reference, if you have both a weekly and monthly payroll for example, all information needs to be collated together and processed as one claim
- You must claim for all employees in each period at one time
- If you are claiming for 100 or more employees you can upload the claim via a spreadsheet directly into the system, but if the claim is for 99 employees or less this need to be inputted manually (although you can copy and paste)
- You must allocate your nominated UK bank account to receive the claim – the monies cannot go to your agent or lawyer for example, nor can they go overseas
- You can make your claim in anticipation of an imminent payroll run, at the point you run your payroll or after you have run your payroll
- You can backdate to 01 March, 2020 or first date an employee was furloughed to end of imminent pay run
- You cannot amend a claim, and therefore have to make sure everyone is included, although HMRC are working on this to allow amendments to be made
- If you are submitting a claim for someone who doesn’t have an NI number, or you can’t get access to your PAYE number, you can now do this over the phone - 0800 0241222
- There is a 30 minute inactivity time out on the portal, and you cannot save your application and come back, so it is important to complete your claim there and then
- You should keep details of your claim reference number once completed
- Tell your employees that a claim has been made and they don’t need to take any further action
- Funds should be in your bank account within six working days of making the claim.
Given that the application must be completed in its entirety it is important that you must have all of the relevant data to hand when making the claim which includes bank account details, PAYE scheme reference number each employees National Insurance number and pension contributions to name but a few. Preparation is key here and making sure you have all of the detail to hand will hopefully ease your experience in using the portal, particularly given that HMRC are still currently working on a solution to correct claims, which isn’t currently in place.
Additionally, you must know the values you are claiming for as the portal system does not calculate the values for you. There is a basic calculator online which can assist with these calculations however it only deals with the most simple of scenarios. So, if, for example, you have anyone on a pro-rata period or any complications where they have variable pay rather than straightforward salary the calculator will not address these variations.
Lastly, make sure you keep a copy of your salary calculations completed with a note of what you have done and the basis for doing so. HMRC have said since the setup of the scheme that they reserve the right to audit any claims at any later date and the guidance around this scheme is constantly changing. We recommend keeping a record of your calculations on file for a minimum of 6 years which will make things easier in the event of a future enquiry.
Full details of the requirements and guidance for making a claim can be found on the GOV UK website.
At AAB we always, and particularly now, view our client relationships as a partnership. We are all in this together and we are here to support businesses through these challenging times.
Read all of our articles relating to COVID-19 here.