On Thursday 1 October 2020, further changes to the job retention scheme take effect. Details of the forthcoming changes are set out below. Please note that the scheme ends on 31 October 2020 and is being replaced by the job support scheme announced last week by the Chancellor.
From 1 October 2020-31 October 2020, HMRC will pay 60 per cent of usual wages up to a cap of £1,875 per month for the hours furloughed employees do not work. Employers will also continue to pay furloughed employees’ National Insurance and pension contributions from your own funds.
What employers need to do from 1 October
Continue to pay furloughed employees at least 80 per cent of their usual wages for the hours they do not work, up to a cap of £2,500 per month. Employers will need to fund the difference between this and the CJRS grant themselves.
The caps are proportional to the hours not worked. For example, if an employee is furloughed for half their usual hours in October, employers are entitled to claim 60 per cent of their usual wages for the hours they do not work, up to £937.50 (half of £1,875 cap).
Employers must still pay their employees at least 80 per cent of their usual wages for the hours they don’t work, so for someone only working half their usual hours they’d need to pay them up to £1,250 (half of £2,500 cap), funding the remaining portion themselves. For help with calculations, check the guidance on GOV.UK.
Make sure your data is right
It’s important that employers provide all the data HMRC needs to process claims. Payment of employers’ grants may be at risk or delayed if they submit a claim that is incomplete or incorrect. HMRC will get in touch if any employee data is missing from previous claims.
Claiming for 100 or more employees – use our new template
The easiest way for employers to provide HMRC with the data needed is to use the updated template.
To help prevent mistakes, the XLS and XLMS versions of the template now highlight any missing information needed to make a claim before you submit it. Where information is missing, fields will be red and once the missing information is filled in, the data fields will turn green. Employers can also now flag if an employee has recently returned from statutory leave, to ensure claims with any new employees are processed correctly.
Claimed too much in error?
It’s important that employers continue to check each claim is accurate before submitting it. HMRC would also recommend checking previous claims to avoid any penalties for claiming too much.
If an employer has claimed too much CJRS grant and has not repaid it, they must notify HMRC and repay the money by the latest of whichever date applies below:
- 90 days from receiving the CJRS money which the employer was not entitled to; or
- 90 days from the point circumstances changed so that an employer was no longer entitled to keep the CJRS grant; or
- 20 October 2020, if on or before 22 July the employer received CJRS money it was not entitled to, or if circumstances changed.
If an employer does not do this, interest and a penalty may arise in addition to the requirement to repay the excess CJRS grant.
How to let HMRC know if you have claimed too much
An employer can let HMRC know as part of their next online claim without needing to call HMRC – the system will prompt you to add details if you have received too much. If an employer has claimed too much and does not plan to submit further claims, they can let HMRC know. Find out how to make a repayment online.
According to HMRC, “We are supporting our customers while tackling serious fraud and criminal attacks. We understand mistakes happen, particularly in these challenging times, and will not seek out innocent errors and small mistakes for compliance action.”