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Version 1 of the CJRS will cease on 30 June 2020.  Employees needed to be furloughed by 10 June 2020 to be eligible for a claim under this scheme to meet the 21 day minimum period requirement.  Claims under this scheme must be submitted by 31 July 2020.

What’s different about CJRS V2?

  • More flexible – employees can work part time and still be furloughed for their remaining usual contracted hours
  • Claims are for a minimum period of a week, unless they contain the first or last day of a calendar month
  • Claims cannot extend over a calendar month
  • An employer must have made a claim under V1 to be eligible to claim under V2
  • Claims will include details of usual hours (based on calendar days) and usual hours actually worked (if any)
  • Maximum number of employees that can be furloughed at any one time under v2 will be limited to the maximum number claimed at any one time under V1 of the scheme
  • Employees must have been furloughed under V1 to be eligible under V2 (unless returning from parental leave)
  • Corrections to previous over claims can be made as part of a new claim
  • The amount that can be claimed is changing
July August September October
Employer NICs and pension contributions
Yes
No
No
No
Wages
80% up to £2,500*
80% up to £2,500*
70% up to £2187.50*
60% up to £1875*

* per month or equivalent

 

What’s not changed?

  • Employers must actually pay a minimum of 80% of pay (or £2500 if lower)
  • Employees on unpaid leave cannot be furloughed unless put on unpaid leave after 28 February 2020
  • The employer must write to employees to furlough them and keep evidence
  • Employees must have been on the payroll on or before 19 March 2020 and been paid on or before that date with an RTI submission having been made to HMRC to be eligible.
  • Employees on sick leave or self-isolating should get SSP from day 1. Alternatively, they can be furloughed as long as their pay is at least equal to SSP.
  • Employees who are shielding in line with public health guidance can be placed on furlough.
  • Employees with more than one job can be furloughed for each job. The cap applies to each employer separately
  • National Minimum Wages rules only apply if the employee is working. So, if furloughed, the 80% can be below NMW
  • Employees can do volunteer work or training whilst furloughed as long as the business does not generate any revenue from this. If furloughed employees do online training courses they must receive NMW for those hours
  • Employers should discuss with their staff and make any changes to the employment contract by agreement. Employers may need to seek legal advice on the process. If sufficient numbers of staff are involved, it may be necessary to engage collective consultation processes to procure agreement to changes to terms of employment.

 

How much you’ll get

  • Salaried employees – full or part time. The salary (not bonuses, commission etc.) for the pay period ending before 19 March 2020 will be used to calculate the claim.  So, for a calendar monthly paid employee, it will be the salary they were paid in February 2020.
  • Employees with variable pay
    • If the employee has been employed for a full twelve months prior to the claim, you can claim for the higher of either:
          • the same month’s earning from the previous year
          • average monthly earnings from the 2019-20 tax year
    • If the employee has been employed for less than a year, you can claim for an average of their monthly earnings since they started work until the date they are furloughed
    • If the employee only started in February 2020, use a pro-rata for their earnings so far to claim.

 

How to claim

Claims will be made through PAYE online in your Government Gateway account and can be made shortly before the payroll is processed and the RTI is submitted for a payroll period (i.e. weekly, monthly etc.).  If Redshield processes your payroll, we will make the claim on your behalf. 

Employers should ensure that their claim meets all the criteria for eligibility as HMRC retain the right to retrospectively audit all aspects of the claim.  All records relating to furlough claims should be retained for 6 years.

Further information can be found at https://www.gov.uk/guidance/claim-for-wage-costs-through-the-coronavirus-job-retention-scheme

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Juliet Morris Director of Redshield Chartered Accountants
Jenny Dinnage Redshield Chartered Accountants Director
Rachel - an employee of Redshield Chartered Accoutants
Emma is an employee of Redshield Chartered Accountants
Amanda is an employee of Redshield Chartered Accountants

Redshield Chartered Accountants Team

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Juliet Morris Director of Redshield Chartered Accountants
Jenny Dinnage Redshield Chartered Accountants Director
Rachel - an employee of Redshield Chartered Accoutants
Emma is an employee of Redshield Chartered Accountants
Amanda is an employee of Redshield Chartered Accountants

Redshield Chartered Accountants Team

We're ready to help you.

We’ll make your accounting easier.

Free, no obligation call. Call us today:

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