Coronavirus Job Retention Scheme (CJRS)
HMRC have now released further guidance on how to calculate the earnings of furloughed staff from the revised scheme which commenced 1 November 2020. As mentioned in previous updates, HMRC will again pay 80% of wages of furloughed staff up to a cap of £2,500 but will not contribute towards any Employers National Insurance or pension contributions. The level of funding is due to be reviewed in January 2021.
Employers do not need to have used the CJRS previously, but ones who do use the scheme from now on will be published by HMRC starting in December. Claims must now be made within 14 days of the end of the claim period.
Employers can claim for employees who were employed on the payroll on 30 October and who have been on a submission to HMRC between 20 March 2020 and 30 October 2020.
Employees that meet the criteria and were on an RTI submission at 19 March 2020 use the same calculation for average pay and hours as previously advised, even if no claim was actually made for the employee.
For employees being furloughed for the first time, the employee pay reference period will be the last pay period on or before 30 October for people who are on fixed hours or salaried. Those on variable hours and pay who were not part of an RTI submission before 19 March will be calculated based on earnings and hours in the 2020/2021 tax year up to 30 October.
Full guidance as updated yesterday can be found at:
Employees can continue to work ‘flexibly’. i.e. part time hours and HMRC will fund 80% of the hours that are not worked. Employees made redundant since 23 September can also be re-employed and put back on furlough.
The employer should agree terms with the employees furloughed in the same way as before.
The portal has opened today for claims since 1 November.