I’m going to keep this introduction short and sweet as I know many of you just want to know how to claim 80% of your staff salaries via the government’s Coronavirus Job Retention Scheme.
In simple, it’s all done via your online Government Gateway so you just need to login using this link – https://www.tax.service.gov.uk/coronavirus-job-retention-scheme – and once logged in it’ll automatically take you through the claim process. It’s as simple as that.
There were some initial issues when the online system first went up and the gov.uk website has confirmed the following requirements for employers in order to be eligible for the scheme:
- Employers must have a Government Gateway (GG) ID and password – if you (or your client if you’re an accountant acting on behalf of someone) do not have a GG account, you can apply here, or by going to GOV.UK and searching for ‘HMRC services: sign in or register’
- Employers must be enrolled for PAYE online – if you (or your client) aren’t registered yet you can do so now by visiting this link – https://www.gov.uk/paye-online/enrol – or by going to GOV.UK and searching for ‘PAYE Online for employers’
In short, if you aren’t registered for PAYE online yet then go and do it as soon as possible to ensure you are eligible for this scheme!
How the Coronavirus Job Retention Scheme Works
The scheme is designed for the government to cover 80% of workers’ wages, up to a maximum of £2,500 per worker, per month before tax. You as the employer need to continue to pay your employees their salary (this can be just the 80% if you agree this with the employee) and then you claim that money back from the government. Due to the recent lockdown extensions, the scheme will be extended until October. Full details on the extension will be released in due course but it is expected that a new flexibility system will be introduced from August to get employees back to work. This system will involve a shared percentage of furlough being paid between the government and employer – what this actually means I’m not quite sure at this time. There has been much speculation on this aspect but let’s wait and see what the government have to say.
How Much Will You Receive? Use the Coronavirus Job Retention Scheme Calculator
The government have created a very helpful online calculator for employers to check exactly what they can expect to be paid to them in order to recoup 80% of staff salaries. This calculator allows you to see how much you can claim for most employees who are paid the same amount each pay period on PAYE. I say ‘for most’ because there are a few exceptions to this calculator, these include employees who:
- receive any top-up pay in the claim period
- returned from statutory leave such as maternity leave in the last three months
- get director’s payments
- have been transferred under TUPE
- have been employed at separate times throughout the year
- receive employer pension contributions outside of an auto-enrolment pension scheme
To view this calculator simply visit the government link here – https://www.gov.uk/guidance/work-out-80-of-your-employees-wages-to-claim-through-the-coronavirus-job-retention-scheme
Details You’ll Need to Make a Claim
When using the PAYE scheme it’s usually quite easy to find these sorts of details, but just for reference here’s what the online portal will generally ask you for when filling out your claim:
- Amount Claimed
- Contact Name & Email
- Claim Period (Start & End Date)
- Number of Employees Furloughed
Who Can Claim for the Coronavirus Job Retention Scheme?
So now you know how to access the online service, let’s quickly look at the main points for eligibility of this scheme. There are quite a few caveats which I’ll put a link to further down, but in the interest of speed the main points are:
- You must be an employer who uses PAYE online
- You started a PAYE payroll scheme on or before 19 March 2020
- You must have employees who have been put on a ‘leave of absence’ (furlough etc) because of coronavirus (COVID-19)
- You have a UK Bank Account
- Employees have to have been furloughed for at least 3 weeks before you can claim for their salary
They are the key points at this stage, if all of those points apply to you then please go and claim for this scheme quickly as I know this is a serious ‘life or death’ situation for many employers/businesses out there. Once you apply, HMRC will of course quickly let you know if you aren’t eligible for any reason so I wouldn’t worry too much outside of those points at this early stage. Just try to apply as soon as possible.
To be more precise however, there are a lot of ‘ifs and buts’ so if you are worried about any of the more detailed exemptions then please have a good read through the government’s own advice here – https://www.gov.uk/guidance/claim-for-wage-costs-through-the-coronavirus-job-retention-scheme