15th April 2020
Clearer guidance on the Government’s Coronavirus Job Retention Scheme, under which employees are placed on furlough leave, has been announced by HMRC and expanded upon by the Chancellor in yesterday’s media briefing.
Key updates include:
- The online portal is intended to be open for use “on or around” 20 April 2020 and is currently being tested.
- The first claims made via the portal are intended to be paid as early as 30 April 2020. There will be gaps of several days between applications and payments to allow for fraud checks and the BACS payment process
- Employees who have transferred under TUPE after 28 February 2020 are eligible for the Scheme. Details of how this will work in practice are yet to be confirmed.
- There has been an informal indication from HMRC that holiday taken while on furlough leave must be paid at full pay
- Reclaimable Employer’s National Insurance and pension contributionsare to be based on the employee’s reduced salary on the Scheme, irrespective of whether the employer has paid any “top up” sums.
- Employees remain unable to carry out any work for the employer whilst on the Scheme, including work for another linked or associated business.
- Directors may be furloughed in respect of their salary, but not dividends, as long as their work for the business is limited to undertaking statutory duties and not generating income or providing services.
- HMRC will issue further guidance prior to the opening of the online portal to clarify the remaining uncertain issues.
- HMRC are running regular webinars on the Scheme: https://www.gov.uk/guidance/help-and-support-if-your-business-is-affecte...
The information provided above is correct as at today’s date, but the situation is changing frequently and rapidly. We will continue to monitor the situation and provide further updates, but please check the HMRC website regularly for the most up to date information and clarifications.