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CJRS - Furlough Webinar Tax Q&As
CJRS - Furlough Webinar Tax Q&As
Claims
If an employee is paid hourly on NMW do you claim on last year’s rate or this year’s rates for weekly standard hours?
NMW is only applicable for any hours spent working, therefore, we would use the pay previously paid to determine the furlough pay.
When claiming the grant, can you claim for a full month or longer or does it have to be for a certain period?
Employers are not restricted on how long they submit a claim for as long as this isn't more than 14 days in advance.
When you put in the claim how many weeks can you claim for in one go?
Employers are not restricted on how long they submit a claim for as long as this isn't more than 14 days in advance.
When claiming weekly payroll can the calculation be on a week by week basis - i.e. choose the higher of either the previous year wages for the equivalent period or the average wage for the previous tax year? Or do you have to opt for one or the other methods and apply that method for each week?
The calculation for variable pay employees would need to be redone each time you reach a new pay period.
When claiming employees who are on the same pay each week - are the rates of payment used for the claim those as at 19/3/20 or those being currently paid - thinking in terms of employees who are on NMW which was uplifted by HMRC in April 2020?
The pay rate is the salary in effect in the last pay period before the 19th March. You would not include the uplift to the NMW rate.
Employee Allowance
Please advise regarding the annual Employment allowance and claiming the ERs NICs through furlough, is it better to delay claiming the Employment allowance
HMRC has not commented on if a claim for Employment Allowance can be delayed until later in the year.
Do we need to enter the employer's NI while filing HMRC Job Retention Form if employer NI covered by Employers Allowance which is £4,000 for 2020-21?
If the employer's NI has been completely offset by the Employment Allowance there will be no Employers NI to claim from the JRS
What are the rules regarding furlough claim and Employers NI, the current HMRC calculator is giving you an amount to claim back re employers NI but saying you are not allowed to claim if you are claiming employment allowance, can you simply claim employment allowance later in the tax year> surely you will be losing out if you don’t?
HMRC has not commented on if a claim for Employment Allowance can be delayed until later in the year.
Directors
We have a director-only business, registered as an annual payroll scheme, who are showing on the government gateway as ineligible due to the reporting annual in March each year. Should these be excluded and ineligible or is the portal incorrect?
If the Annual PAYE scheme has submitted an RTI return on or before the 19th March in the 19/20 tax year then they will be eligible to take part in the scheme. If the RTI return is submitted after this date, they won't be eligible to take part in the scheme.
For tax purposes, Directors would normally increase their wages for April in line with the NI threshold but does that mean they will only get 80% of the lower salary as that was what was paid before 19/3/20?
Yes, the furlough pay will be based on the salary received in the last pay period before the 19th March.
Pay
Do early years nursery provider calculate furlough pay post receipt of government / LA funds (the receipt of this funding is not significant to the business) or pre receipt of funds?
HMRC has issued guidance specific to earlier years providers: https://www.gov.uk/government/publications/coronavirus-covid-19-financial-support-for-education-early-years-and-childrens-social-care/coronavirus-covid-19-financial-support-for-education-early-years-and-childrens-social-care#sector-specific-guidance
Do weekly variable pay staff calculate their furlough pay on a calendar basis or a day’s work basis e.g. a weekly employee who works 3 days a week is their pay calculated on the 3 days worked a week usually or the 7 calendar days in a week to calculate their average weekly pay Estate agent gets a basic plus commission per sales? All part of their contract. Should average over the year be taken to work out furloughed amount?
HMRC guidance states that calculations should be completed on calendar days. HMRC guidance is unclear on which calculation should be used if there is both a salary and their pay varies each pay period. Due to this, it may be possible to argue that either calculation is appropriate.
If I pay my hourly paid staff their full contracted hours for the contacted month can I use this payment to calculate the 80% or do I need to calculate an average? Am I also planning on paying the 100% to staff?
If the employees are usually paid the same annual salary, then we can use their pay from the last pay period before the 19th March. If their pay can vary, we would need to use the higher of: their pay from the same pay period last year or an average of the 19/20 tax year.
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