Great news! The Coronavirus Job Retention Scheme (CJRS) has been extended from 30 April to 30 September 2021. This means that employees can continue to be paid 80% of their usual pay for hours not working up to £2,500 per month.
What does this mean for employers? Employers are required to contribute 10% of pay in July and 20% in August and September i.e., the government will be contributing 70% and 60% respectively, the remainder is to be paid by the employer. Pay is based on ‘Usual Pay’.
Eligible employees are those that have been included in a PAYE Real Time Information (RTI) submission between 20 March 2020 and 2 March 2021.
Deciding on the ‘Usual Pay’ for an employee depends on the ‘Reference Date’. There are three periods to consider:
Working this out is more involved than for Fixed Pay.
• wages earned in the corresponding calendar period in a previous year
• average wages payable in 2019/20 tax year
they can be furloughed from 1 May 2021. You need to use 2 March 2021 as the reference date and calculate 80% of average wages payable between 6 April 2020 (or the date the employment started, if later) and the date before they were first furloughed on or after 1 May 2021.
If you’ve claimed too much grant through the CJRS then you must pay this back. You can also make a voluntary repayment if you do not want or need the grant to pay your employees’ wages, PAYE and National Insurance and Pension Contributions.
If you are still making Furlough claims, you can correct it in your next claim. This means the new claim will be reduced by the amount you are repaying. Or if you are not able to adjust your next claim you can get a payment reference number and pay back HMRC within 30 days.
Records of all your furlough claims and adjustments must be kept for 6 years after you made the claim.
Of course, if you get stuck then feel free to get in touch with us and we will do what we can to help you. Otherwise, the HMRC website is a mine of useful information. In order to create this blog post, we consulted the HMRC website and our own manuals.
Calculate wage costs:
Examples of how much you can claim:
Post originally published in May 2021, updated July 2021.
Connect with us